Commercial Mortgage Alert reported that real estate developers will have to shift gears from the pari-passu distribution of funds that was widely expected pre-COVID, and be prepared for the subordinate, or mezzanine, portion of the debt package be fully funded first. Madison Realty Capital Managing Principal, Co-Founder Josh Zegen explained that the sequential structure has become “the new norm over the last few months, it’s a lot more costly from a borrower perspective,” noting that lenders have also generally raised rates and reduced leverage for new debt up and down the capital stack. MRC is active nationwide, with loan amounts from $5-500 million. 

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