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The pivotal role that commercial
mortgages played in the commercial
real estate finance market of the past 30 years have focused on, by and
large, the experienced developer (or sponsor as the case may be) and largely
left the less experienced developers out in the cold as most commercial
mortgages were/are being made based upon the balance sheet resources of the
borrower. Today, all of that is changing and commercial mortgages (and
lenders) are now being placed in the position of actually having to compete for
funding opportunities.
Rainmaker Marketing Corporation has
added fractional
real estate syndication financing syndications to the developer's tool
kit. The commercial real estate syndication approach provides financing
for the proposed project at the pre-construction phase, construction phase or
post-construction operating phase. The developer/sponsor qualifies the
project based upon the due diligence documentation and status of the
project. Click
here for more information on qualifications.
Rainmaker Marketing Corporation's
syndication program has some attributes you are going to appreciate:
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Each syndication has an initial
marketing period of 90 days. In that period of time a minimum of
$2,500,000 (or the minimum amount required by the developer, if that amount
be greater than $2,500,000) in gross real estate fractional ownership units
must be sold for the syndication to be considered a success and the
developer be obligated to take the financing offered by Rainmaker.
That's right. If the minimum sales threshold hasn't been reached, the
developer/sponsor is not obligated to close with Rainmaker.
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If a syndication is successful,
it remains open until the issue is sold out or market interest in the
syndication evaporates. The syndication will continue sales and these
funds will eventually (if a given syndication is 100% sold-out) retire the
debt financing. Once this level is reached, the resulting project has
no bankruptcy risk exposure or foreclosure risk exposure until the
developer/sponsor acquires additional assets.
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Rainmaker's approach is to
create financial investment leverage for the benefit of the syndication
participants and the developer/sponsor of the project by incorporating
(wherever and whenever possible) investment incentive entitlements that can
be used to increase investor yields without necessarily diluting the
developer/sponsor's entrepreneurial opportunity.
This new approach to the
construction financing paradigm is designed to put the developer back in control
of the most intricate and risky phase of development for the proposed project -
the capital financing phase. Now the developer (or sponsor, as the case
may be) can move forward with the due diligence reporting necessary to support
the transaction knowing that a market-based solution for equity gap financing is
available and may be brought to bear on every project the developer undertakes,
now and in the future.
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