@HealthcareREguy on X | $2 Billion of Healthcare Real Estate Sold (MOB, Dental, Veterinary)
It's helpful to think of lenders not just as lenders but as investors themselves. Everyone in real estate is investing in the deal in some way. The lender is just an extremely risk averse investor. Because of this, if a deal goes sour, they need to be paid back first. But it also means that if the deal goes well, they only ask for their principal to be paid back, with interest. Understanding the risk/return preference of each deal participant - from senior lender to mezzanine lender to preferred equity investor to common equity investor - is critical if you're trying to pitch and raise capital from each group.
Excellent point, Michael Moreno! Viewing lenders as risk-averse investors offers valuable insight into their role in real estate deals. Understanding the distinct risk/return preferences of each participant, from senior lenders to equity investors, is crucial for effectively pitching and raising capital. This perspective can help align interests and expectations, ultimately leading to more successful partnerships.
Commercial Banker | 85% LTV Conventional OOCRE Loans
1moLove this man. Going to borrow this next time I’m getting pressed on our reluctance to execute on a deal.