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RE bridge loan exit ops?
 

WSOusername's picture
 
Points)
 on 7/18/12 at 3:10pm
RainbowBridge.jpg

Not much to add here. Just, curious what exit opps would look like from a RE finance shop specializing in short term bridge loans would look like. I'd imagine fairly thorough property level analysis is needed considering said properties are taken over if a loan goes bad. Also seems like great exposure to transactional/ capital/ underwriting/ valuation experience. For these reasons, I feel like acquisitions would be a relatively fluid exit op? Perhaps also RE capital markets? Perhaps I'm completely wrong (leaning towards this)? Please advise.

*If you couldn't tell by now, this is regarding RE bridge loans, not VC or CF

GBS
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JimboUSC's picture

pretty interested in this as

IB
 
Points)
 on 7/18/12 at 11:27pm

pretty interested in this as well

RE Capital Markets's picture

I would say that you would

RE
(Gorilla, 649
 
Points)
 on 7/19/12 at 1:45pm

I would say that you would probably pick up some valuable skill-sets. Your exposure will be more finance heavy than real estate heavy, which isn't necessarily a good or bad thing.

Exit opps - hard to say, but you should be well-prepared for both acquisitions and RE capital mkts.

Man made money, money never made the man

WSOusername's picture

Thanks RECM. Just wasn't

 
Points)
 on 7/19/12 at 2:01pm

Thanks RECM. Just wasn't sure if experience at these bridge loan type shops would be unfavorably looked upon since they seem kind of "loan sharkey" compared to the more conventional financing avenues.

GBS

prospie's picture

GoldmanBallSachs: Thanks

(King Kong, 1,682
 
Points)
 on 7/19/12 at 2:27pm
GoldmanBallSachs:

Thanks RECM. Just wasn't sure if experience at these bridge loan type shops would be unfavorably looked upon since they seem kind of "loan sharkey" compared to the more conventional financing avenues.

In my opinion, there's a lot of value in working on loan sharkey deals, because it means you are working on riskier, more entrepreneurial deals. It's harder for me to get excited about underwriting a 10-year loan on a building that's leased through 2030 to a AAA-rated tenant. Others might disagree, but personally if I were a lender, I'd have a lot more fun doing bridge loans, construction loans, etc than permanent mortgages. Just my two cents.

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MrRealEstate's picture

prospie: GoldmanBallSachs:

 
Points)
 on 7/19/12 at 10:25pm
prospie:
GoldmanBallSachs:

Thanks RECM. Just wasn't sure if experience at these bridge loan type shops would be unfavorably looked upon since they seem kind of "loan sharkey" compared to the more conventional financing avenues.

In my opinion, there's a lot of value in working on loan sharkey deals, because it means you are working on riskier, more entrepreneurial deals. It's harder for me to get excited about underwriting a 10-year loan on a building that's leased through 2030 to a AAA-rated tenant. Others might disagree, but personally if I were a lender, I'd have a lot more fun doing bridge loans, construction loans, etc than permanent mortgages. Just my two cents.

Prospie - you do have to remember that permanent financing doesn't always assume low risk. The bread and butter of CMBS are deals that are stabilized, but by no means pristine. The riskier the deal, the higher the pricing (and return once sold). The deals leased through 2030 located in 24/7 cities with AAA rated tenants all go to life cos. For CMBS you are generally looking at something with near term roll, a risky major tenant, a tertiary market, and possibly all of the above. You may not be doing opportunistic deals, but not all permanent loans are "slam dunks." But I digress...

GBS - don't know much about bridge loan exit opps as I haven't met anyone who focused on them exclusively. I think it would depend on the volume you saw. Agree with Prospie that you might see some unique/riskier situations that could be interesting. I'd encourage you to check out the profiles of people at various firms you would like to work and see if bridge loan experience shows up in their bio.

George Martin's picture

Others might disagree, but

(Chimp, 2
 
Points)
 on 7/26/12 at 2:35am

Others might disagree, but personally if I were a lender, I'd have a lot more fun doing bridge loans, construction loans, etc than permanent mortgages. Just my two cents.

http://www.petstrollers.cc

Quest4CapRate's picture

Hard money (read short term

(Chimp, 5
 
Points)
 on 7/31/12 at 9:14am

Hard money (read short term bridge) is respected in the lending/finance community. Forget the sterotype and focus on what you do, high risk high reward underwriting. It's only "loan sharkey" in real estate. It is called a lot of other things on Wall Street from "high-yield" to 'lev-fin" and in most cases is viewed as a savy fixed income play.

JimboUSC's picture

I'm curious what is comp like

IB
 
Points)
 on 7/31/12 at 12:40pm

I'm curious what is comp like in this field? From entry level to higher up positions

WSOusername's picture

"Forget the sterotype and

 
Points)
 on 7/31/12 at 2:11pm

"Forget the sterotype and focus on what you do, high risk high reward underwriting. It's only "loan sharkey" in real estate."

Unfortunately, that is exactly the type of hard money lending I'm refering to, lol. It does, however, seem like it has a fine image from what I've taken from here (correct me if I'm wrong).

GBS

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