Braco Realty Capital, LLC
Bridge Loans
We have in-house bridge loan money for deals in Colorado, as well as relations with a plethora of bridge lenders available for all sorts of assets classes and situations across the United States. We can shop a loan for you through our various contacts with finance companies, debt funds, hedge funds and high net worth individuals, to present the most competitive terms for your situation. Lower leverage bridge loans on properties in transition can see rates in the 4-7% rate, with higher leverage and riskier, renovation bridge loans being priced in the 5-10% range.
Often used to acquire property quickly and transition it to get it stabilized, bridge loans are an invaluable tool in the box of any CRE professional. Whether buying a sub performing retail strip or overhauling an old office building, bridge loans are frequently used for renovations and lease up scenarios. We have closed many bridge loans with numerous debt funds, finance companies, hedge funds and private individuals, for all sorts of different properties. Retail, Office, Industrial, Hospitality, Apartments, Broken Condos, and Special purpose deals like Bed and Breakfast, Sports Arenas, Churches etc.
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Pricing on bridge deals varies greatly due to the scenario and location. Lower priced bridge loans can be a couple hundred basis points over libor 3-6%, to more hard money type bridge loans in the 8-11% range. It is a great vehicle to acquire properties quickly and reposition them, and buyers realize the importance of this feature when they have to close a deal on a property that is in demand, sometime a quick close wins a deal. A little delay for some other bidder working with a bank can lose earnest money and the property, often times we get bank fallouts with less than two weeks to close. When working with Braco Realty Capital, we try and make sure that no one will miss out on a good opportunity just because they lack time and/or cash.
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Senior Stretch bridge loans that encompass senior and mezzanine portion of the capital stack, can require as little as 10-15% down payment by the borrower. Solid business plan and team to execute are essential to the successful funding of a bridge loan.
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Bridge loans are usually interest only payments, and can be flexible as well. Some can come with interest reserve built into the loan amount, so the borrower can avoid payments while repositioning the property until cashflow from tenants is substantial enough to make payments. Other times it’s important to find a bridge lender that only charges interest on money outstanding, as in the form of a line of credit, vs. a fully funded loan (that has at Improvement Holdback) held in escrow at the time of closing. However, sometimes developers prefer to have the Improvement Escrow Holdback so they know the funds will be available in uncertain economic times, and can avoid a lender freezing a credit line as some did in the Credit Crisis of 2008.
Sometimes just getting the right bridge lender and right program can save hundreds of thousands of dollars in interest over the course of a project. We at Braco Realty Capital will make sure you get the most competitive rates and terms, and that the loan is custom tailored to the needs of the project and not custom tailored to the lenders wants.
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Also for borrowers sitting on lots of equity and looking to pull cash for other investments, a bridge loan can be a great choice as you may not need to pay the loan back in the form of regular installments. You can repay the loan after selling your property. This is a great advantage for anyone who’s planning to sell the property but requires cash urgently. No need to wait for months to get the cash, as we will help to cash out with bridge loans in Colorado, Utah, Idaho, New Mexico, Washington, or any other part of the United States.
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Depending on your needs, you can get a loan from a few months to several years. Contact our representatives with your financing needs and duration, and we will provide you with the details after consulting on your needs for your specific property.