It now seems, that despite pressure from the U.S. and the IMF, Germany’s decision to hoard cash reserves and maintain low debt, to enable them to deal with a “worst-case scenario” has proven almost prophetic. This situation has now materialised, and the government has been well placed to aid Germany’s recovery with a substantial financial rescue package. The German government has been typically efficient and resilient, in its management of the virus and its financial support given to its workforce. They have confounded many countries with their low death rates and stable unemployment figures. The property development market has continued
Read more →General Overview As we finally see Europe starting to ease restrictions and get back to work, with shops and business’s beginning to reopen we must start to evaluate the potential impact on the lending and, in particular, German Bridging Finance. It has been well reported even by the most partisan of media, that Germany has lead Europe in its response to this pandemic. The economic impact appears to be less, at this stage, than other countries, with GDP only falling 2.2% in the first quarter against neighbouring countries with a fall of 4 to 6%. The unemployment rate went from
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The term mezzanine finance as used within the UK is a description given to a combination of debt and/or preferred equity financing. Whether you are an investor seeking to place an investment, or a borrower seeking to maximise investment into a business, mezzanine finance is a popular and attractive solution. Mezzanine lending is a sum lent or invested into a business on a junior basis that ranks in priority behind senior debt, but ahead of standard equity. By virtue of being subordinated to senior debt, which in itself often secures the main banking facility, the returns reflecting the risk are
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What is Mezzanine Finance? Mezzanine development finance is designed to act as a top-up loan, to bridge the gap between the developer’s available deposit and the loan available from the senior lender. Mezzanine funders will usually secure their position by taking a second charge over the development to ensure their capital is secure. By supplementing their borrowing with mezzanine finance, property developers can secure the highest return on investment, with the lowest deposit contribution. This financing option is generally used to reduce the deposit needed to undertake a property development project. Funding can be used to reduce deposits, to fund
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