Updated 15 days ago on . Most recent reply
Private conversations with private lenders.
Private lenders talk to me about this constantly.
Not the deals that worked. The deals that are unraveling and why.
It is always the same story told with different addresses and different asset classes but the same root cause. The project was mismanaged before it started.
Low bid that nobody questioned because the number made the deal work on paper. Timeline built around optimism not experience. No real cash reserves because the pro forma was already stretched. Construction funds covering holding costs by month two. Engineering mistakes that added scope mid-project. Wrong sequencing that created rework. A sponsor who knew how to raise money but had never actually managed a construction project through to completion.
None of this is bad luck. All of it was predictable by anyone who has done this before.
The thing that kills me is what every one of those lenders says when you ask what they want in a deal.
Experienced operator. Skin in the game.
They are not asking for a perfect track record. They are asking for proof that you have been through the hard part before and that you have enough of your own money at risk to care about the outcome the way they care about the outcome.
That proof does not come from a pitch deck. It comes from a budget built on real numbers, a timeline built on how construction actually works, reserves that exist before the project starts, and a history of delivering what you said you would deliver at the cost you said it would cost.
Most people raising private capital right now cannot show all four of those things. That is exactly why the lenders who have been burned keep asking for them.
Don't be the story they tell the next person who sits across from them. Build it right from the beginning or don't build it at all.