CRE financing, in plain language.
Practical guides on how commercial real estate debt and equity actually work, written for sponsors, developers, and operators evaluating their next capital decision. No fluff, no sales pitch.
Bridge
3 guidesWhat Is a Commercial Real Estate Bridge Loan?
A commercial real estate bridge loan is short-term debt, typically 12 to 36 months, used to fund an acquisition, renovation, lease-up, or repositioning before the asset qualifies for permanent financing. CRE bridge loans exist to finance the gap between an asset's current condition and its stabilized future, and they are one of the most flexible tools in a sponsor's capital stack.
How Do Commercial Bridge Loans Work?
Commercial bridge loans work by funding an asset through a transition, acquisition, renovation, lease-up, or stabilization, using interest-only debt structured around the business plan rather than the in-place cash flow. The lender funds initial proceeds at closing, holds an interest reserve to cover debt service during stabilization, and funds future draws for renovation as work is completed.
Commercial Bridge Loan Rates in 2026
Commercial real estate bridge loan rates in 2026 typically range from SOFR + 250 to SOFR + 600, all-in coupons, depending on asset class, leverage, sponsor track record, and business plan risk. With SOFR sitting in the 4%-5% range as of mid-2026, all-in bridge coupons land roughly between 7% and 11%, though the specific number for any given deal depends on multiple factors.
Construction
2 guidesGround-Up Construction Loan Guide
A ground-up construction loan funds the development of a commercial real estate asset from foundation through certificate of occupancy. These loans are structured around the construction budget rather than the in-place value of the asset, and they carry distinct underwriting, draw mechanics, and exit requirements that differ materially from bridge or permanent debt.
How Non-Recourse Construction Loans Work
A non-recourse construction loan limits the sponsor's personal liability to the asset itself, rather than allowing the lender to pursue the sponsor's personal balance sheet if the loan defaults. But in construction lending, 'non-recourse' is almost always non-recourse subject to a completion guarantee, which is itself a meaningful recourse obligation.
Multifamily
2 guidesHUD vs Agency Multifamily Loans
HUD-insured loans (FHA 223(f), 221(d)(4), 232) and agency loans (Fannie Mae, Freddie Mac) are the two dominant sources of long-term multifamily debt in the United States. Both are non-recourse and offer attractive coupons relative to bank or CMBS debt, but they differ materially in leverage, term, process, and execution speed.
Value-Add Multifamily Financing
Value-add multifamily financing funds the acquisition and renovation of an existing apartment asset, with the loan structured around the post-renovation stabilized value rather than the in-place cash flow. The right capital structure makes the business plan work; the wrong structure can re-trade the deal or strand capital mid-renovation.
Structure
5 guidesDSCR Commercial Loans Explained
A DSCR commercial loan is a commercial real estate loan sized to the property's debt service coverage ratio rather than to the sponsor's personal income or credit. DSCR is the most important sizing constraint on permanent commercial debt, and understanding how lenders calculate it, and what they expect, is the difference between getting full proceeds and leaving capital on the table.
Mezzanine Debt vs Preferred Equity
Mezzanine debt and preferred equity both occupy the same position in the capital stack, between senior debt and common equity, but they are structured very differently. Choosing the right one depends on the senior lender's intercreditor preferences, the sponsor's tax and control objectives, and the deal's overall risk profile.
CMBS vs Bank vs Debt Fund: Lender Comparison
Commercial real estate debt comes from three primary institutional sources: CMBS (commercial mortgage-backed securities), balance-sheet banks, and debt funds (private credit). Each prices and structures differently, and choosing the wrong lender for your deal can leave proceeds, flexibility, or cost on the table.
Loan-to-Cost vs Loan-to-Value
Loan-to-cost (LTC) and loan-to-value (LTV) are the two primary leverage metrics commercial lenders use to size CRE debt. Understanding the difference, and knowing which is binding on a given deal, is what produces accurate proceeds estimates and prevents capital surprises at closing.
The Commercial Real Estate Capital Stack
The capital stack is the layered structure of debt and equity that finances a commercial real estate deal. Each layer has its own cost, security, and risk profile, and the right capital stack matches the layers to the business plan, the sponsor's objectives, and the senior lender's intercreditor preferences.
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