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  August 27, 2005
Pacific Security Capital Newsletter
Commercial Real Estate Consulting Services
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Mezzanine Loan & Financing

Pacific Security Capital provides mezzanine financing according to the following underwriting guidelines:

Eligible Properties:

We will consider Multifamily, Retail, Industrial, Office, Hospitality, and Condominium projects/properties for the following types of investments: Development; Recapitalizations; Renovations; Yield Plays, and; Interim Funding needs.

Eligible Locations:

We lend in all 50 states and most parts of Canada. While we prefer Tier I and Tier II Markets with strong market fundamentals in place we often fund transactions in small markets where project economics and collateral are compelling.

Loan Amount:

$3MM - $30MM with larger transactions being considered on a case-by-case basis

Coupon:

Depending upon project dynamics, sponsor suitability and deal structure rates will fall between 10% and 18% on a fixed or floating rate, interest only basis. Accrual options may also be available.

Term:

Terms from 1 month to 36 months (extension options available).

Deal Structure:

True mezz debt secured by member/ownership interests inside or outside the LLC with a standard inter-creditor agreement.

PSC will also consider alternative structures such as subordinated lease-backs, full equity participation as evidenced by priority returns, or other creative structures providing increased leverage for the borrower.

Underwriting:

PSC will fund up to a maximum of 90% of the capital structure in a B piece. There is no minimum debt coverage ratio. A minimum sponsor co-investment of 5% - 10% in required. Each transaction is based upon PSCís valuation of all underlying collateral.

Fees:

Origination Fees vary based upon loan term and may be waived in lieu of equity/participation or increased coupon. Standard third party reports may be required if not available from the senior lender.

Time Frames:

PSC can typically close and fund mezzanine debt within 90 days with some transactions able to be closed within 45 days if all third party reports are available and acceptable to PSC.

For more information on Mezzanine Loans & Mezzanine Financing from Pacific Security Capital please see our FAQ's, fill out our online application or contact PSC directly.