CapStra was mandated to raise $23.4m (equivalent to 65% of total equity) in preferred equity and $110m in peak senior construction debt to assist with the development of 202 residential apartments and 1,177m2 of retail NLA in Sydney’s Inner West.
Leveraging existing investor relationships Identify private and institutional investors both domestically and offshore, to seek expression of interest for a preferred equity participation in the project. In addition to sourcing preferred equity, CapStra approached Australia’s four largest Banks for senior debt construction finance.
CapStra identified a preferred counterparty for the equity participation and negotiated the terms of investment. CapStra advised on and managed the documentation process, including satisfaction of conditions precedent to investment. The preferred equity investment valued the land at market price, which reflected a substantial uplift to cost, and the quantum of the investment enabled the Borrower to realise its cash equity in the transaction upfront, and participate during the construction phase on a notional basis. The preferred equity was entitled to a preferred return plus a share of super-profit.
Further, CapStra simultaneously conducted a tender process amongst the four banks for the senior debt facility and negotiated key terms. CapStra managed the credit approval process, provided oversight during the documentation process and process to financial close.