Capital Source of the Week - Unique Recapitalization Financing

Nebo has identified a Southern California Investment Firm with a unique financing program for equity recapitalizations in the $500,000 - $5,000,000 range.

Program Parameters:

  • A recap tool for existing ownership or JV equity for new ownership structures.
  • For assets located in primary and secondary markets in California, Texas, Colorado, Arizona, Nevada, Oregon and Washington.
  • The investment capital is cash flow driven, so deals must provide for preferred return to be paid current.
  • Typical amount of investment capital per transaction is $500,000 to $5,000,000.
  • Product preference – Office, Medical Office, Industrial, Retail, Mini-Storage and Multi-Family.
  • Ownership must be strong and experienced such that it can demonstrate its ability to execute the prescribed business plan for the asset.
  • The equity investment is secured by a partnership interest reflective of its share of the total current equity in the asset.
  • Terms of each transaction will vary, but a typical structure will require an 8% to 10% preferred return to be paid current annually from cash flow during the hold period, and upon a refinance or sale, a priority return of the investor's equity, plus additional proceeds to achieve an IRR of 15% to 20% (inclusive of cash flow).