In the midst of the financial crisis a developer needed to sell a hotel (364 rooms), in Berlin to free equity and avoid default with the bank. A willing buyer was able to buy the property if provided with €66M of debt.

 

Cycas was hired by the seller to structure a stapled finance deal for the buyer. We reviewed the property’s cash flow and concluded a mezzanine finance structure would make the transaction feasible.

 

In four months the transaction was closed with €60M of Senior debt from a German bank structured through their London Branch (to be able to speed up and process the transaction) and €6M mezzanine debt with the Jersey Branch of a South African bank. The property was sold before the bank could call default.