How we underwrite certainty of execution for sponsors

Every lender promises certainty of execution. Fewer are built to deliver it. The difference is structural: who makes the credit decision, when they make it, and whether the terms on the page are terms the lender can fund.

Why it matters more in this market

The Federal Reserve raised its target range on 16 September. The 10-year Treasury traded above 5% in late September and was back near 4.9% by early November. CBRE reports that alternative lenders closed 48% of non-agency loans in the third quarter, up from 37% a year earlier, as banks stepped back to 26%.

When benchmarks move that quickly, quotes go stale between application and closing. A sponsor under a purchase contract or facing a maturity cannot absorb a retrade.

Our process

We run the same six steps for every sponsor, with the timing stated up front.

• Submission. The sponsor opens the full file room: asset, business plan, capital stack, financials and timing.
• Screening. A yes or no on mandate fit and a sponsor call, within one to two weeks of a complete file.
• Full underwriting. We underwrite the transaction directly and review the whole capital stack, typically over two to four weeks.
• Credit sizing and approval. An internal committee decision, approved or denied, in one to two days.
• Credit quote. Issued once committee has approved.
• Binding term sheet. The transaction moves to closing and funding.

What makes the terms hold

• We originate and underwrite directly. The team that issues the terms is the team that approved the credit.
• Committee comes before the quote. A sponsor receives a quote only after the credit has been approved, not as an invitation to begin diligence.
• We size to the downside. Every loan is stress-tested against rates, lease-up and exit assumptions worse than the business plan, so a move in the market does not reopen the terms.
• We review the whole stack. Senior, subordinate and equity are underwritten together, which removes the intercreditor surprises that delay closings.

What we ask of sponsors

A complete file, a realistic business plan and fast responses. The timeline above depends on them. In return, we do not retrade: the terms we issue are terms we are able to fund.

This article is for general information only. It is not investment, legal or tax advice, and it is not an offer to lend, an offer to sell or a solicitation to buy any security. Past transactions and past performance are not indicative of future results.