Mezzanine Financing Calculator
Calculate mezzanine loan costs, analyze capital stack structures, and compare financing scenarios for your commercial projects.
Mezzanine Loan Calculator
Enter your project details and financing terms to calculate mezzanine financing costs
Understanding Mezzanine Financing
What is Mezzanine Financing?
Mezzanine financing is a hybrid form of capital that fills the gap between senior debt and equity. It's subordinate to first-lien debt but senior to equity, providing additional leverage for acquisitions, developments, and recapitalizations. Rates typically range from 12-20% due to its higher risk position.
Key Features
- Higher interest rates than senior debt (12-20%)
- Often includes interest-only periods
- May have equity participation (warrants, kickers)
- Flexible prepayment terms
- Subordinate to senior debt in repayment
When to Use Mezzanine
- Gap financing: When senior debt + equity falls short
- Minimize dilution: Preserve equity ownership
- Acquisitions: Fund buyouts and expansions
- Development: Finance construction with limited equity
Important Considerations
- Higher cost increases break-even requirements
- Intercreditor agreements with senior lender
- Exit timing aligned with loan maturity
- Covenant compliance and reporting requirements
- Prepayment penalties may apply