Case Study: $13M Commercial Real Estate Bridge Loan Placement
Case Study — $13M Commercial Real Estate Bridge Loan Placement
A sponsor approached us with a time-sensitive acquisition opportunity but limited liquidity. With only 20% equity available, traditional senior lenders were hesitant. Through targeted underwriting and controlled distribution, we structured a $13M bridge loan that closed within the acquisition timeline and later refinanced into permanent debt.
$13M
Bridge Loan Raised
20%
Sponsor Equity
8 Weeks
To Closing
The Challenge
The sponsor identified a high-potential acquisition but faced a liquidity gap. With only 20% equity, conventional lenders were unwilling to meet the timeline or provide the leverage required. The acquisition hinged on securing bridge financing that could carry the project until stabilization and permanent financing were achievable.
Our Solution
We underwrote the property’s rental revenue in detail and sized debt capacity conservatively against projected cash flows. To mitigate lender risk, we structured a Debt Service Reserve Account (DSRA) funded at closing, providing a coverage buffer for the first six months. This gave lenders confidence while protecting the sponsor’s ability to operate during the transition.
Our forward-flow capital partners reviewed the file under our distribution program. Within a controlled auction, we secured multiple competing bridge offers. The winning structure was a $13M facility at competitive pricing, closing in line with the acquisition contract.
The Outcome
This case highlights how structured bridge financing can unlock acquisitions that would otherwise be out of reach due to equity shortfalls. Careful underwriting, risk buffers like DSRAs, and disciplined lender selection were central to the outcome.
Key Takeaways
- Sponsors with limited equity can still access institutional bridge financing with the right structure.
- Debt Service Reserve Accounts are effective tools for mitigating cash flow uncertainty in the early months post-acquisition.
- A controlled term sheet auction process ensures competitive pricing and terms while avoiding market overexposure.
- Bridge loans, when underwritten properly, set the stage for smoother refinancing into permanent capital.
Explore Bridge Financing Options
We raise capital for acquisitions, redevelopments, and recapitalizations when time and certainty matter most. Our forward-flow lender agreements ensure competitive terms without wasted time. Minimum engagement fee: $25,000.
Request a ProposalFinancely is a financial advisory and placement firm. We are not a direct lender. All financings are subject to due diligence, lender approval, and executed documentation. Engagement fees for commercial real estate bridge loan mandates start at $25,000. Terms and pricing depend on jurisdiction, sponsor profile, and asset performance.
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