Mezzanine debt is like a second mortgage on a home. It's behind the senior debt, but priority over equity, so good credit quality is essential to reducing the risk.
Las Vegas, NV (PRWEB) November 20, 2014
Versant Commercial Brokerage has successfully raised $2.2MM in mezzanine debt for the United Healthcare Office Building located at 2716 North Tenaya Way in Las Vegas, Nevada. Versant raised the capital within days of making the investment available. The 204,123 square foot building is triple net leased to United Healthcare.
Versant was able to tap into its private network of accredited investors to raise the needed funds to complete the deal. “Many investors need cash flow to fund their retirement. We were able to cut out the Wall Street middlemen and raise capital directly from individual accredited investors,” said Matt Mueller, President of Versant.
“Mezzanine debt is an important part of a well diversified portfolio,” said Mueller. “The yield on this transaction is extremely competitive at 15%; the key is to have a strong credit tenant, like United Healthcare, standing behind the payments. Mezzanine debt is like a second mortgage on a home. It’s behind the senior debt, but priority over equity, so good credit quality is essential to reducing risk.”
The investment term was four years, with a yield of 15%, paid monthly. “These returns are not unusual,” said Derek Uldricks, Vice President at Versant. “However, most of these mezzanine investment opportunities are gobbled up by hedge funds or other highly sophisticated real estate investors. We are excited to offer these institutional quality investments directly to individuals.”
The property was recently refinanced with $51,000,000 in new senior debt. Previously owned by a group of tenant in common (TIC) investors, the property did not have enough capital to cover all of the costs associated with tenant improvements and leasing commissions. This is a common problem with TIC owned properties.
Versant is also assisting some of the current owners of the property who wish to sell their interests. Versant makes a market in the sale of TIC investments. Typically, when a TIC owner attempts to sell his or her interest, they are offered a deep discount due to the illiquidity of the investment. Versant’s marketplace for TIC interests allows TIC investors to liquidate their equity positions at or near market value and recover as much of their equity as possible.
About Versant Commercial Brokerage
Versant is a commercial real estate and finance firm. We provide high quality investment opportunities for individual investors by creating access to exclusive deals. Our professionals have advised on over $3,000,000,000 of commercial real estate engagements.
Through a private network of investors, we provide debt and equity capital for commercial real estate projects. Our network of relationships, sophisticated analyses, and experience in deal structuring give us a unique capabilities to place debt and equity for real estate projects nationwide.
Our investors obtain superior returns by directly investing in exclusive opportunities. We reduce costs by eliminating redundant financial intermediaries
Please visit http://www.versantcre.com to learn more about our investor services.