Start here
Three ways to begin, depending on whether you are studying debt, raising money or checking a partner.
Path one: the capital stack and lending
Begin with the capital stack. Senior debt, mezzanine debt, preferred equity and common equity each sit in a fixed order of repayment. Loan to value and debt service coverage ratios show how a lender sizes the loan.
Path two: raising capital and structuring the deal
Raising capital starts with a clear offer. Read how a private placement memorandum and an operating agreement work together, then follow a waterfall as it sends cash to investors and the sponsor in tiers. Worked examples cover preferred returns and catch ups, plus promote splits such as 80/20 and 70/30, with the arithmetic shown line by line. Terms matter. Every split changes who gets paid first, and by how much. A sponsor who understands these mechanics can write a sharper term sheet and answer an investor’s questions without guessing.
Path three: vetting a sponsor or partner
Vetting runs in both directions. Investors examine a sponsor’s track record, references, prior deal performance and any litigation history. Sponsors, in turn, study how a family office decides: its mandate and check size, plus the investment committee that approves each commitment. Both sides save time.
Understand the capital stack and lending
- Lending and credit: How lenders size, price & structure commercial mortgages, and how borrowers qualify.
- Capital stack: How senior debt, mezzanine debt, preferred equity and common equity layer into one deal and who gets paid first.
- Equity versus debt: What each kind of capital costs, what it demands and how its claim on the property differs.
Raise capital and structure the deal
- Capital raising process: The steps a sponsor takes to find investors, present an offer and close the raise.
- Waterfalls and splits: How profits are split between investors and sponsors: preferred returns, catch ups, promotes & fees.
- Deal preparation: What a sponsor assembles before approaching lenders or investors: the business plan, the numbers and the documents.
Vet a sponsor or partner, and see the family office view
- Sponsor diligence: The evidence an investor asks for before trusting a sponsor with capital, and how to read it.
- Vetting partners: How to check a joint venture partner, operator or co-investor before you sign.
- Family offices in real estate: How family offices evaluate real estate, size their exposure and choose partners and sponsors.