RCRE – Preferred Equity 101 with Rob Beardsley

Key Information:

• Preferred Equity is a hybrid product which is subordinate to the senior loan but has payment priority over common equity positions.
• Benefits of Preferred Equity include: Sponsors and developers are provided with a higher degree of leverage at lower cost than common equity. For real estate investors it also provides opportunity to capture a fixed rate of return prior to payment and can sometimes include upside.
• Preferred Equity offers a hybrid risk/return profile. In addition to payment priority over common equity, it provides some recourse provisions in the case of borrower default.

Read further: https://randcre.com/preferred-equity-101-with-rob-beardsley/