UPDATED MAY 7, 3:55 p.m.: BridgeInvest, a Miami-based private lender, is banking on growing demand for short-term financing.
It just closed its second fund with a total capitalization of $200 million and $150 million in equity raised. The fund marks the firm’s second fund, which is more than double the size of its first, which had a total market cap of $100 million. The company now plans to launch a third fund before the end of the year, which will be structured as a real estate investment trust, according to Ian Glaser, a partner at BridgeInvest.
BridgeInvest provides ground-up construction loans and short-term loans in the Southeastern United States and Texas. It specializes in value-add deals where there is limited or no cash-flow, customized terms and short time frames. The company has said it is able to provide loans that are more customizable than what a conventional bank would provide. In the future, the firm is also looking to provide loans in the Midwest, according to Glaser.
BridgeInvest has had no principal losses to date on its loans since its founding in 2011, according to a press release. Last June, it provided Benjamin Norton’s Design Development Partners a $28 million loan from for its mixed-use Design 41 project in the Miami Design District.
In January, the company provided Property Markets Group a $33 million pre-development loan for the Waldorf Astoria Hotel & Residences Miami.
The company’s specialty bridge lending program offers loans between $3 million and $50 million with interest rates between LIBOR plus 5.5 percent and LIBOR plus 7.99 percent. It offers construction loans between $5 million and $50 million with the same interest rates as its bridge lending, according to its website.
Increasingly, short-term bridge lenders like BridgeInvest are becoming more popular as banks back away from making customizable loans. Many banks have also stepped back from doing ground-up construction lending since the last recession, leaving nonbank lenders to fill this void.