Many investors think they understand financial terminology like preferred equity, but they may each be thinking of something different, which can cause confusion and misunderstanding. This article defines preferred equity and explains how to discern the difference between the various types. Preferred Equity Definition Preferred equity works similarly to preferred stock in the corporate sector […]
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When describing the financial framework of a real estate transaction, the term “capital stack” is commonly used (frequently depicted as a bar graph or pyramid). The capital stack defines the many forms of capital invested in a real estate asset and their respective relationships. There are traditionally two primary categories of capital: Experience and Risk
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Financing of Commercial Real Estate and the Capital Stack In commercial real estate, it is often said that finance is king. In other words, before contemplating a project, examine how it will be funded. Without a fully defined and executed finance strategy, also known as a capital stack, a substantial amount of money remains a
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