Transaction
Interest-only bridge loan for the purchase of a medical facility.
Published financing features
- 2-year term
- Based solely on the target, with no related corporate guarantees
Published client benefits
- Closed a large-scale transaction without affecting the existing portfolio
- Interest-only structure assured excess cashflow for an easy bridge exit
- Increased overall value of the enterprise
How this kind of financing works
Commercial property transactions do not always wait for the permanent financing structure to be ready. A property may still need stabilising, another transaction may have to close first, or the long-term lender may simply need more time than the purchase agreement allows. Bridge financing solves a timing mismatch: the acquisition has to happen now, and the permanent capital structure comes later.
Because it is temporary, the exit is the most important part of the analysis. Before arranging a bridge, a borrower should be able to say precisely what will repay it — permanent financing, a refinance after stabilisation, a sale, or another clearly identifiable liquidity event — and the term should allow enough time to execute that realistically.
An interest-only structure services the interest during the bridge period without amortising principal, which preserves cash flow at the point the borrower needs it most. Where a facility is underwritten against the target property alone, without guarantees from related corporations, the acquisition can be completed without drawing other operating companies or properties into the security structure — which matters to any owner with an existing portfolio to protect.
Historical example only. It is not a promise of terms, availability, or results for a future transaction.
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