REAL ESTATE DEVELOPMENT FINANCING PROCESS

摘要

A real estate development financing process is provided. Initial financing is provided through equity from a real estate developer. The equity financing from the real estate developer is sufficient to provide overhead protection to an insurable portion of the real estate development costs. The equity from the real estate developer is combined with new debt. The new debt is sufficient to cover fees, insurance premiums, and contingent capital. The equity from the real estate developer and the new debt is combined with senior debt. The senior debt sufficient for the costs of the real estate development remaining after the equity from the developer and the new debt. At least a portion of the new debt or the senior debt or both are insured. In one embodiment, the new debt is collateralized with insurance. The new debt can take the form of an insurance product comprising a low cost debt instrument as a substitute for mezzanine financing in real estate development financing. In one embodiment, a real estate development risk index can also be provided.