Need some creative lending options. $3.8 million deal on the hook

[John Patrick Lasher]

I am in the process of purchasing 3 properties all right next two each other. 1 multifamily and 2 commercial office space of which we plan on using a significant portion of for our medical practice. Coming up short on 20% capital. Would be interested in some ideas to bring that number down. 

[Noah Wright]

Quote from @John Patrick Lasher:

I am in the process of purchasing 3 properties all right next two each other. 1 multifamily and 2 commercial office space of which we plan on using a significant portion of for our medical practice. Coming up short on 20% capital. Would be interested in some ideas to bring that number down. 

Kinda hard to make $760,000 appear out of thin air, haha. There's hope:

1. Seller Financing: If the seller is willing, you could negotiate a deal where they finance a portion of the down payment, often called a "seller carryback." This reduces the amount of upfront capital you need.

2. Mezzanine Financing: This type of subordinate financing can help fill the gap between the primary loan and the equity you're contributing. It's often more expensive but can work if the cash flow from the properties supports it.

3. Cross-Collateralization: If you have other properties with equity, you might be able to use those as collateral to secure better loan terms or additional funding.

4. Partnership or Syndication: Bringing in additional investors or partners could help you raise the required capital. This could be structured as equity or a preferred return to your partners.

5. Retirement Accounts

6. Wealthy People You Know / Are Related To...

Good luck!

[Brandon Croucier]

Hi John,

For something of this size, the seller might be willing to carry a portion, but odds are your lender wont approve of it.

I would look for an equity partner if I were in your boat.

[Bob Stevens]

Quote from @John Patrick Lasher:

I am in the process of purchasing 3 properties all right next two each other. 1 multifamily and 2 commercial office space of which we plan on using a significant portion of for our medical practice. Coming up short on 20% capital. Would be interested in some ideas to bring that number down. 

 Simple, bring on a partner, or borrow it , 

[Jesse Holsapple]

20% is more than the 15% you probably have available I'd assume? You'd need a JV partner and they would probably want to take control of that project.

Your best bet at that size is not going to be mezz, most of them cut checks at 2mil minimum. 
Is seller carry and either an indivual private lender or to go raise a little capital!

Goodluck

[Matt Devincenzo]

This sounds like you have an existing, and I assume, successful practice in place. If that's the case and you're using the majority of the space for that practice then a business purpose loan like SBA may be a better fit. They can be 10% down for RE associated with a business. That coupled with a 5-10% seller carry could get you where you need to be. 

The only thing is if the MFR is purchased with this, but not for the business then you may not be able to consider it in this loan so you may still need an alternate option there. You don't say how short of 20% you're coming up, but I'd start with your current business banking relationship and discuss options with them. If they can't/won't facilitate look for a new local business bank that has a "consultative" approach and see what they'd consider to bring your banking to them.

[Chris Seveney]

Quote from @John Patrick Lasher:

I am in the process of purchasing 3 properties all right next two each other. 1 multifamily and 2 commercial office space of which we plan on using a significant portion of for our medical practice. Coming up short on 20% capital. Would be interested in some ideas to bring that number down. 

 How short of the 20% are you?

[John Patrick Lasher]

That seems to be a tricky question as everyone I've talked to has a different list of what I can include and what I can't. For instance, we have a line of credit against another profitable business that we are the sole owners of. We have a HELOC available against our house. We have another property we paid cash for earlier this year. We have about 35% in liquid assets right now. If we could use the other items I listed, we are right there. If not, we are 65% of the 20% missing.

[Jared Rine]

@John Patrick Lasher..you have some good responses here but I figured I'd throw mine into the net.  I don't know if you're trying to do this all with the same lender, but if you're taking up a majority of the office buildings, SBA could be an option which would allow you potentially less down and you can get away with some seller carry (not all lenders allow and/or structure this but some do)...and/or you could potentially wrap in more collateral (like that other property) which some will do (Again not all SBA lenders are the same; some get way more creative than others).  If you could do this and the multifamily property can stand on it's own, you might have enough equity free to get that one done too, depending on the financing possibilities available and how flexible you can be with terms.  Without seeing more details, it's tough to go into the weeds.  Feel free to reach out.  Thanks,