Emerging Private Lending, How to get the Capital for your Project

Joaquin Gutierrez,

Private Lending in CRE: Q&A Guide for Brokers & Investors

Private credit is an increasingly vital source of financing for commercial real estate (CRE) projects. Below are the key questions you’ve asked—and the expert answers you need to navigate this market.

1. What Is Private Credit in CRE?

Private credit refers to non‑bank loans provided by funds, insurers, pension plans, or specialty managers. In CRE, these lenders often offer:

  • Higher LTVs: 65–75% vs. 50–60% from banks.
  • Shorter Terms: 2–5 years, often with bullet repayments.
  • Floating Rates & Fees: SOFR + spread, origination and management fees.
  • Fewer Covenants: Less reporting and more flexible structures.

2. Who Brokers These Loans?

Commercial mortgage brokers and capital advisors arrange private‑credit financing:

  • Mortgage Brokers (e.g., Walker & Dunlop, Greystone, Lument) present deals to debt funds.
  • Capital Advisors (e.g., ACORE Capital, Eastdil Secured, CBRE Capital Markets) structure mezzanine or preferred equity.
  • Direct Lenders (e.g., Blackstone Credit, Apollo, Starwood Property Trust) sometimes accept submissions directly.

3. How Do I Seek Financing?

  1. Prepare Your Package: Executive summary, pro‑forma, rent roll, use‑of‑proceeds, exit plan.
  2. Select a Broker/Advisor: Choose regional brokers for smaller deals; national advisors for complex or larger financings.
  3. Make the Intro: Use referrals or “Submit a Deal” portals to share your package.
  4. Compare Term Sheets: Evaluate spreads, fees, LTV, covenants, prepayment terms.
  5. Close & Manage: Coordinate due diligence (appraisals, enviro reports) and ongoing reporting.

Key Takeaway: By understanding players, processes, and structures, you’ll position yourself—and your clients—to move quickly and confidently when private‑credit capital is available.

Real Estate