Project Finance Loan Refinancing: Reduce Cost, Extend Tenor, Release Cash

Project finance loan refinancing involves replacing an existing facility—often structured at financial close—with new debt under improved terms. Sponsors refinance for various reasons: lower interest rates, longer tenor, simplified covenants, or to release trapped equity once construction risks are behind them.

At Financely, we help project owners and operators refinance mature infrastructure, energy, logistics, and industrial assets by syndicating debt facilities to banks, funds, and institutional investors globally.

1. Why Refinance a Project Loan?

• Interest Savings: Replace high-margin construction loans with lower-cost operational debt.
• Cash Release: Unlock equity by upsizing based on operating cash flows and DSCR history.
• Tenor Extension: Improve cash flow by stretching repayment over a longer period.
• Lender Rotation: Remove lenders who are no longer aligned or seek exit post-COD.
• Simplify Structure: Combine multiple tranches into a single bullet or amortizing loan.

2. When to Refinance

• After commercial operations date (COD) is reached and performance is stable.
• Minimum 12–24 months of operating history with clean DSCR above 1.25x.
• Major technical or regulatory milestones cleared (e.g. grid connection, tariff validation).
• Existing lenders are unwilling to fund expansion or provide flexibility.
• Market conditions offer lower spreads, or better appetite for the sector/jurisdiction.

3. Types of Refinancing Financely Arranges

• Take-Out Financing: Pay off original lenders with new, cheaper debt.
• Debt Consolidation: Merge multiple loans into one streamlined facility.
• Balloon Refinance: Replace near-maturity balloon payment with new amortizing debt.
• Cash-Out Refinance: Increase facility size and distribute equity to shareholders.
• Currency Refinancing: Convert hard currency debt to local currency post-COD.

4. Typical Terms We Negotiate

• Loan Size:$10 million to $250 million+
• Tenor: 5 to 15 years depending on asset class and cash flow profile
• Repayment: Structured amortization, sculpted to match revenue
• Covenants: Simplified, cash flow-based with tested and projected DSCR targets
• Pricing: Market-linked margins depending on credit, location, and structure

5. What Lenders Look For

• Stable operating cash flows with verified DSCR history and low volatility.
• Transparent financial statements and clean audit trail.
• No unresolved technical defects, claims, or material litigation.
• Clear repayment waterfall and covenant compliance track record.
• Valid concession, permit, or license life exceeding new loan maturity.

6. Financely’s Refinancing Process

1. Initial Review: Submit your existing loan documents, model, and asset summary.
2. Underwriting: We build or audit the financial model and identify cash flow potential.
3. Mandate: Subject to review, we propose a scope, timeline, and engagement fee.
4. Term Sheet Design: New terms mapped out to target lender appetite.
5. Investor Sounding: Syndicate approach with shortlisted credit providers.
6. Closing: We coordinate documentation, due diligence, and drawdown logistics.

7. Real Use Cases

7.1 – Renewable Energy Platform (Southern Africa)

• Original Loan:$60M construction facility at 9% interest
• Refinanced:$75M at 6.2% with 13-year amortizing tenor
• Benefit:$15M equity released and $6.5M interest saved over life of loan

7.2 – Industrial Water Facility (Eastern Europe)

• Refinancing Trigger: Original funder exiting due to internal portfolio rebalancing
• New Structure: Consolidated senior loan from an infrastructure debt fund
• Tenor: Extended by 5 years with improved cash sweep terms

8. Who We Work With

• Sponsors: Project developers, industrial groups, renewable energy companies
• Funds: Infrastructure and private equity funds with mature portfolio assets
• Asset managers: Holding special purpose vehicles (SPVs) in need of liquidity optimization
• Government-linked entities: Seeking better terms on utility-scale assets

9. Financely’s Edge

• Speed: We build lender-ready structures fast—no endless "consulting" delays
• Access: Direct connections with 300+ global lenders, funds, and credit platforms
• Realism: We filter out weak options and push for executable terms only
• Alignment: Our model is fee-based and transparent—no hidden agendas

10. Ready to Refinance Your Project Debt?

If your asset is cash-generating and your current facility is overpriced, restrictive, or nearing maturity—we can help structure and raise a refinancing solution that works.

Request a Refinancing Quote

Financely does not act as a lender or guarantee performance. All financing arrangements are subject to underwriting, legal due diligence, and lender decision. We do not accept crypto or third-party payments outside formal engagement.