Here’s what syndicators should know in structuring deals in the current state of affairs:
👉Currently, bridge rates are close to 5% starting, which is much higher than the sub 4% we’ve seen the last few years. Rates are fluctuating, and it’s vital to take that into consideration as you prepare for your next acquisition. Consider a fixed rate, long-term financing.
👉Anticipate no more than 70% leverage on the deal.
👉Raise additional equity. The more liquidity you have - the more flexibility you have. When you have liquidity, you can adjust to any changes that may happen from the time you go under contract to the time you close.
👉Make sure you have enough time built into your contract. This will allow you flexibility to pivot if needed.
And finally…. Having the most up-to-date information from your mortgage broker in the current state of our economy can impact your deal immensely. Make sure to ask questions from your broker so you feel confident they are aware of everything impacting the market.