3 Creative Capital Stack Structures Keeping Deals Alive in 2025

[Paul G. Ward III]

3 Creative Capital Stack Structures Keeping Deals Alive in 2025

Rates are high. Lenders are cautious. Yet good sponsors are still closing — by engineering smarter capital stacks, not waiting for rates to fall.

Here are 3 structures we’re seeing work right now 👇

1️⃣ Senior + Mezzanine Layer

When banks stop at 65–70% LTC, adding a mezzanine layer pushes leverage up to ~85%.

It’s structured debt — not equity — letting sponsors close gaps without dilution.

2️⃣ Preferred Equity Replacing Mezz

With mezz pricing tightening, many sponsors are pivoting to preferred equity — same position in the stack, but with more flexible terms and upside participation.

Often used when senior lenders won’t allow a true mezz note.

3️⃣ Bridge with a Construction Tail

Bridge lenders are extending into stabilization periods, giving developers time to lease up or season cash flow before refinancing into perm debt.

That flexibility can make or break timelines right now.

🧩 Why this matters:

Capital creativity is the difference between paused and closed deals.

The capital stack isn’t fixed — it’s engineered.

💬 Question for the group:

What’s the most creative capital stack you’ve closed (or seen) in this market?

#RealEstateInvesting #CapitalStack #CREFinance #PreferredEquity #MezzanineDebt #BridgeLoans #DealStructure #CommercialRealEstate #DevelopmentFinance #BiggerPockets