Mezzanine Financing

Mezzanine financing in real estate is a method of funding that sits between traditional debt (like loans) and equity (ownership). It typically involves borrowing against the value of a property, allowing developers to access additional capital without giving up equity. This type of financing often comes with higher interest rates and may include the option for lenders to convert their loan into equity if the borrower struggles to repay. Essentially, it helps bridge the gap in funding for projects, enabling investors to undertake larger developments while balancing risk and reward.