Mezzanine Debt for Office Assets
Quick answer
Kismet Kapital structures mezzanine financing for office assets at 80–85% LTC, typically closing in 30–60 days. Underwriting is leasing-driven: in-place income, rollover, TI/LC reserves, and credit profile.
- Product
- Mezzanine Debt
- Asset Class
- Office
- Typical Leverage
- 80–85% LTC
- Typical Close
- 30–60 days
- Term
- Co-terminus with senior, typically 2–7 years
- Recourse
- Non-recourse with intercreditor
Overview
Office capital remains highly structured, with most transactions capitalized through a blend of senior debt, mezzanine, and preferred equity tied to leasing momentum. Mezzanine debt is structured behind senior debt and secured by an equity pledge in the borrower entity. It enables sponsors to reach total leverage that exceeds what a senior lender will provide. For office assets, mezzanine proceeds are sized against underwriting is leasing-driven: in-place income, rollover, ti/lc reserves, and credit profile. repositioning capital often requires structured debt with hold-back tranches.
Why sponsors use Kismet Kapital for office mezzanine capital
office transactions are typically capitalized with Bridge, Mezzanine, Preferred Equity, Permanent (Selective). Kismet Kapital identifies which of those structures the current lender market will actually fund for your business plan, then runs a competitive process across the desks pricing office risk today.
Terms at a glance
- 80–85% LTC typical proceeds for mezzanine on office assets.
- Executions generally close in 30–60 days.
- Current pay plus accrual, governed by an intercreditor agreement.
- Common structures: Bridge, Mezzanine, Preferred Equity, Permanent (Selective).
- Acquisition top-up behind senior debt
- Construction sub-debt
Key facts
Kismet Kapital typically closes mezzanine financing on office assets in 30–60 days.
Mezzanine Debt for office assets generally size to 80–85% LTC.
Office capital stacks commonly include Bridge, Mezzanine, Preferred Equity, Permanent (Selective).
Frequently asked questions
What leverage is available on mezzanine financing for office assets?
Mezzanine Debt for office assets typically size to 80–85% LTC, with the exact proceeds driven by in-place income, business plan, and sponsor experience.
How long does a mezzanine loan on office take to close?
Most office mezzanine executions close in 30–60 days from signed term sheet.
How do lenders underwrite office assets?
Underwriting is leasing-driven: in-place income, rollover, TI/LC reserves, and credit profile. Repositioning capital often requires structured debt with hold-back tranches.
What capital structures work best for office assets?
Office Assets are typically capitalized with Bridge, Mezzanine, Preferred Equity, Permanent (Selective). Kismet Kapital engineers the mix that maximizes proceeds without breaking the business plan.
When is mezzanine the right product for an office deal?
Subordinate debt that sits between senior debt and equity to increase total leverage. It fits office transactions such as acquisition top-up behind senior debt and construction sub-debt.
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