DH maintains unique relationships with core lenders and investors who provide non-recourse capital to investors and developers alike. We assist clients in obtaining competitive permanent, bridge and construction loans and negotiate aggressively on their behalf to achieve their investment property goals and objectives.
DH maintains unique relationships with core lenders and investors who provide non-recourse capital to investors and developers alike. We assist clients in obtaining competitive permanent, bridge and construction loans and negotiate aggressively on their behalf to achieve their investment property goals and objectives.
Non-Recourse / Future Funding Facility / Interest-Only / Flexible Loan Structures
DH arranges short to medium term capital for acquisitions and recapitalizations of existing assets. Ideal for transitional, non-stabilized assets with a value-add component or situations where a quick closing with surety of execution is needed. Bridge loans typically include, but are not limited to, opportunistic investment transactions for mispriced assets with substantial upside through turnaround situations, discounted payoff and discounted note acquisitions.
Non-Recourse / Up-To 80% LTV / 5, 7, 10 Year Term / Interest-Only Available
DH long-standing lender relationships provide non-recourse financing for the acquisition and refinance of hotel properties. We facilitate customized loan structures with low interest rates, longer amortization periods and flexibility. These hotel financing options are designed for cash-flowing and stabilized hotel properties in primary, secondary and tertiary markets. All hotel franchises are considered.
Non-Recourse / Up-To 80% LTV / 5, 7, 10 Year Term / Interest-Only Available
DH arranges mezzanine debt to give a sponsor greater proceeds and go higher on the capital stack (LTV) than what senior conventional debt would allow. Mezzanine loans are typically secured by second liens on real estate or by partnership and limited liability company interests. They are ideal for opportunistic purchases to minimize the direct common equity required, recapitalizations, financing PIPs and refinances where the principal amount currently owed is higher than what senior debt loan commitments can be obtained. Pricing of these financing vehicles varies and is based on the risk associated with the transaction. Our experienced team can navigate you through the mezzanine financing process and provide you with a customized solution for your next hotel project
DH works together with specialized lenders and opportunity funds that provide investors with preferred equity. In situations where certain lenders prohibit mezzanine debt to lever a property, an equity position can be beneficial to reach an LTV ratio of >90%.
PREFERRED EQUITY PROGRAM REQUIREMENTS (Subject to change due to market conditions)
Eligible Locations: Continental U.S. and Canada
Purpose: Purchase, refinance, discounted payoff, recapitalization, construction completion, note purchase, etc.
Transaction Sizes: Typically $1,000,000 to $10 million, higher on a case by case basis
Ownership: Single asset, special purpose entity.
Preferred Equity Return: Typically a current pay rate + a percentage of ownership and associated cash flow that varies according to project plan & available cash flow.
Minimum Levered IRR target: Varies per transaction.
Minimum NOI %: Depends on market/property type/brand/etc.
Commitment Deposit: 1% of preferred equity amount (minimum $20,000) payable upon acceptance of Preferred Equity Term Sheet for site inspection, 3rd party costs, legal and closing costs. Any remainder credited at closing, or refunded in the event the deal is not approved.
Buy/Sell Agreement: To be defined in the operating agreement
Preferred Term: 3–5 yrs
Reserves: Real estate taxes, hazard insurance, replacement reserves, and mortgage interest may be required.
Underwriting Considerations: Heavy emphasis on value creation, market analysis, sponsorship, and exit strategy.
Third Party Reports: MAI Appraisal, Phase I environmental, feasibility and others if required at expense of Sponsor.
Sponsor Promote: Occurs after specified IRR hurdles are met and tiered based on the success of the investment.
Closing Time: As early as 30 days from receipt of full package, application acceptance and deposit remittance.
