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Conduit Loans, Investments, Fundings & Financings...
Developers
seeking non-recourse
conduit loans and/or equity financing syndications can now
combine their requests into a single program track to minimize the
carrying costs and due diligence documentation requirements for new
construction commercial real estate projects, nationwide.
Rainmaker Marketing Corporation focuses on creating the condition precedents to allow
non-recourse conduit loans (or what amounts to the same thing - a
commercial lender non-recourse loan) to be acquired if the developer
utilizes the equity financing syndicate approach to lower the
proposed loan-to-cost ratio of the proposed loan by dramatically
increasing the project's equity contributions.
The
key to making this happen is an understanding of the flexibility
that can be engineered into the capital financing structure of the
new construction project for the benefit of the developer, the
project employees and the investing-public:
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Increasing
equity capitalization in the project can be done without
necessarily creating additional equity dilution on the part of
the developer; far from it as every Rainmaker structured project
provides the developer with the opportunity to get a free
earn-out to ownership of up to 90% of the project equity
pool. This allows the developer to move forward on the
basis of an understanding that market timing (either for
disposition of the asset or for a refinancing of the existing
debt) is now a practical consideration that can be very
beneficial.
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Dividing
the project into two (2) categories of ownership: the
income-producing property ownership investment income
opportunity and the ongoing business operations income
opportunity. By dividing the resulting project into two
(2) separate pools of ownership interest, the developer can
shield the investor pool from a majority of the liabilities and
subjective investment risks the pool would otherwise have to
bear, while creating the opportunity for finite holding period
opportunities that allow different groups of investors (having
different goals from group to group). The resulting
conduit loan, while being non-recourse, must be considered in
terms of any cross-collateralization requirements the conduit
may have as opposed to other non-recourse loan opportunities
that may be available.
Continued
on following page.
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Do
You Know The Secret?
When it comes to commercial real
estate development finance, it doesn't matter whether you need to raise
$5 million or $50 million, the out-of-pocket costs, advance fees and
project due diligence costs will always require the same relative
investment dollars the promoters have to fund. Do you know what
that amount is? Do you know the Secret? |
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