Joint Venture funding
This type of financing is created through an affiliation in which both parties agree to share capital, risks and rewards of the venture. It is different from a partnership in that it relates solely to a particular project.
Why choose joint venture/equity for your commercial real estate project?
Shared Capital
By pooling your capital with another party, you’ll multiply your available resources, which in turn greatly increases your chance of success.
Shared Risk
You won’t have to do it alone in a joint venture agreement. Both parties assume a degree of the risk, responsibility and reward of the venture.
Hotel insurance loans
An Insurance Commercial Real Estate Loan is a mortgage that is provided by a life insurance company or conglomerate of life insurance companies and is secured by a first lien position on the subject property being financed. Most life insurance companies favor the “four food groups,” for their collateral (apartment, office, retail, and industrial properties), but may finance other property types (i.e. hotel or mixed used) on a case-by-case basis.
Underwriting Parameters
For life insurance loans, Lenders have continued and even strengthened their conservative approach toward underwriting the cash flow of the collateral as well as the borrowers and sponsors. As part of the underwriting process, Insurance Companies are simultaneously assessing the risks of default while trying to minimize such risks, so they require detailed borrower and property information.
Term Length and Amortization: The length of term and amortization depends heavily on the institution providing the funding as well as the property type.
Recourse:Life insurance loans may be non-recourse, limited recourse, or full recourse loans. If it is non-recourse, the Borrowers are not personally liable for the repayment of the loan and that the collateralized property and its cash flows would be the sole source of repayment of the debt in the event of a default or foreclosure.
