|
| | Tax Credit
Project Financing & Entitlement Program Consulting...
Rainmaker
Marketing Corporation typically completes the  statutory tax
credit project financing review as part of the market
feasibility study investment
incentive entitlements review. Rainmaker routinely prepares
tax credit project financing plan proposals for new construction
programs. Tax credits have the requirement for the project to be
placed in service before the tax credits may be captured. This
means that while the tax credits will be part of the capitalization of
the project, the reliance on these credits for a portion of the
construction phase capital financing of the project may in fact lead to
disastrous delays when the developer finally realizes the timing issue.
Rainmaker
Marketing Corporation's
structured finance review (therefore) includes the tax credit analysis,
but also includes the following additional elements:
 |
Conversion
of a portion of the project space plan into a condominium ownership
plan. The sale of the condominium units would be to the
investing-public. The public would hold these units with an
eye towards receiving a share of the operating profits and
incremental equity gains created by the units. In turn, the
developer receives capital investment that can be pulled into the
project in the last 45 to 60 days of the project's construction
phase.
|
|
Creation
of a syndication plan for a tenants-in-common fractional commercial
real estate ownership interest equity sale. If the syndication
is successful, the proceeds of the sale can be used to:
|
provide
sufficient equity contributions to induce a construction
mortgage financing lender (or private placement offering to
create an essentially similar outcome) to close on the
construction financing; then
|
|
if
sales provide sufficient equity contributions, an amount may be
raised, the sufficiency of which induces a lender to provide the
construction mortgage financing loan on a non-recourse basis for
the project; then
|
|
if
still more sales provide enough equity contributions, an amount
may be raised to obtain the non-recourse loan and allow the
developer to withdraw the developer's seed investment, thus
dramatically compounding the developer's long-term holding's
internal rate of return; then
|
|
Continued
on following page.
| |
|
|
Do
You Know The Secret?
When it comes to commercial real
estate development finance, it doesn't matter whether you need to raise
$5 million or $50 million, the out-of-pocket costs, advance fees and
project due diligence costs will always require the same relative
investment dollars the promoters have to fund. Do you know what
that amount is? Do you know the Secret? |
|
