Mezzanine Development Finance
Layer mezzanine debt behind your senior construction facility to reduce equity requirements and take on larger projects. Second-position finance that bridges the gap between senior debt and developer equity.
Key Features
Second-Position Debt
Sits behind the senior construction loan in the capital stack
Reduce Equity
Lower your cash contribution from 35-40% down to 10-20%
Scale Projects
Take on larger developments without additional equity partners
Flexible Structure
Capitalised interest, profit share, or hybrid arrangements
Recently Funded Deals
See what's possible with the right finance solution
*Based on real deals settled by Andorra Private. Details may be generalised for confidentiality.
Unregistered MIS — Industrial Warehouse Portfolio
The Scenario
A property syndicate structured as an unregistered managed investment scheme sought finance to acquire a portfolio of large industrial warehouses in regional Victoria.
The Challenge
The syndicate required non-recourse lending with no directors guarantees — a structure many lenders are unfamiliar with. Loan documentation needed to reflect the MIS trust structure correctly, requiring coordination between the client, their solicitor, and the bank's solicitor.
The Solution
We identified a major bank willing to provide a lease-doc facility on a non-recourse basis. We then worked closely with all parties — the client, their legal counsel, and the bank's solicitors — to ensure the loan contracts correctly reflected the trust structure and that no personal guarantees were required.
The Outcome
The facility was successfully arranged with a major bank. The syndicate acquired the warehouse portfolio with no directors guarantees, and all loan documentation was executed correctly on the first pass.
Non-Recourse
Structure
None
Guarantees
Lease-Doc
Facility Type
Major Bank
Lender
Client Testimonials
Hear from our satisfied clients
“Nick as a broker is part of my dream team for not only residential but especially commercial lending and has been nothing short of brilliant! Always calm under pressure and gets the job done. Very proactive and knowledge far superior to other brokers I've worked with. He's also got another option up his sleeve to ensure you achieve your goals. Absolutely no hesitation in recommending Nick for all things finance. Do yourself a favour and have a preliminary chat with Nick.”
Rachael
Commercial Lending
“Nick is an absolute gun at his job. I've been through many brokers over the years, and he is by far the best I've worked with. His knowledge in the commercial space is second to none, and the way he handles the process is completely seamless.”
P
Commercial Finance
“Nick is super professional and highly competent in his craft. He guided me with credible lending options and advice during my commercial property purchase journey. Highly recommended.”
ADS Rawal
Commercial Property
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Start ApplicationWhat Is Mezzanine Development Finance?
Mezzanine finance is a layer of debt that sits between the senior construction loan and the developer's equity in the capital stack. Where a senior lender might fund 60-65% of total development costs, mezzanine finance can cover an additional 15-25%, reducing the developer's cash equity requirement significantly.
This product is essential for developers looking to scale beyond what their balance sheet alone can support. Rather than bringing in equity partners and sharing profits, mezzanine debt provides leverage at a fixed cost, allowing developers to retain full ownership and upside.
How Mezzanine Finance Is Structured
Mezzanine facilities are typically structured as second mortgages or equitable charges behind the senior construction lender. Interest is usually capitalised (rolled into the loan) and repaid at project completion from settlement proceeds. Rates range from 12% to 20% per annum, reflecting the subordinated risk position.
We arrange mezzanine facilities from specialist funds and private credit providers who understand development lending. The mezzanine lender works in conjunction with the senior lender under an agreed intercreditor arrangement, ensuring both parties' interests are aligned throughout the project.
Discuss Your Mezzanine Development Finance Needs
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Frequently Asked Questions
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