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Active equity mandates · Pref, JV, mezz, co-GP

Structured Equity

Capital that completes the stack.

Piccard Financial arranges structured equity — preferred equity, JV equity, mezzanine debt, co-GP capital, and gap capital — for sponsors and developers whose acquisitions, projects, or recapitalizations require proceeds beyond senior debt.

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Capital Strategy

Structured equity is priced by the waterfall, not the coupon.

The same project can support several different structures depending on the sponsor's return target, the LP's hurdle requirements, the senior debt position, the project's risk profile, and the realistic exit. The right capital protects sponsor promote and LP economics in parallel.

  • Preferred equity, JV equity, mezzanine debt, co-GP, and recapitalization structures
  • Family offices, structured-equity funds, debt funds, and institutional LP capital
  • Acquisition, development, value-add, recapitalization, and partner buyout situations

Structured Capital Coverage

Capital stack solutions between senior debt and common equity.

Pricing

IRR + Promote

Position

Below Senior

Structures

Pref, JV & Mezz

Check Size

$2MM–$75MM

Overview

The capital stack is more than senior debt.

Structured equity sits between senior debt and common equity. It is used when a sponsor needs more proceeds than senior debt alone provides, when a project requires partnership capital to close, or when an existing partnership needs to be recapitalized, restructured, or refreshed without a full refinance.

Pricing is rarely a coupon alone. Returns are built from current pay, accrual, IRR hurdles, promote splits, and exit-fee mechanics that are negotiated against the project's risk profile, the senior debt position, and the realistic exit. The structure determines the cost as much as the rate.

Piccard Financial positions each structured equity request around the project, the sponsor, the senior capital, the LP's return requirements, and the planned exit, then approaches the appropriate audience — preferred equity programs, mezzanine funds, family offices, structured equity platforms, and institutional LPs capable of executing.

Structured equity is structure-specific

  • PricingReturns are typically built from current pay coupons, accrual, IRR hurdles, and promote participation. Cost of capital varies significantly by structure, position, and project profile.
  • PositionSubordinate to senior debt and senior to common equity. JV and co-GP structures take true equity risk; preferred and mezzanine take hybrid debt-and-equity positions.
  • Cost of CapitalBlended cost across the structured layer depends on coupon, accrual, hurdle, and exit waterfall. The "all-in" cost is the return delivered through the exit, not the headline rate.
  • ControlMajor decision rights, removal provisions, transfer restrictions, approval thresholds, and standstill mechanics are negotiated as carefully as the return profile.
  • TermAligned with the business plan: typically three to ten years for development, value-add, and recapitalization, with redemption rights tied to a defined exit.
  • ExitSale, refinance, partner buyout, scheduled redemption, or recapitalization with new senior debt — each path produces different sponsor and LP economics through the waterfall.

Common Structures

The right structure for the project's economics.

Each structured equity assignment is positioned around the project, the sponsor, the senior capital, and the LP audience — the right structure is the one whose return profile matches the deal.

Hybrid Capital

Preferred Equity

Cumulative current pay plus accrual, with or without promote participation, positioned behind senior debt and ahead of common equity in the waterfall.

True Equity

JV & Common Equity

Co-investment capital with full waterfall participation — pari passu or subordinate to sponsor equity, with negotiated promote splits at defined hurdle thresholds.

Subordinate Debt

Mezzanine Debt

Subordinate debt secured by a mezz pledge of equity interests, governed by an intercreditor agreement with the senior lender and structured around defined exit mechanics.

Sponsor-Level

Co-GP Capital

Capital at the sponsor level to support GP equity contributions, fund pursuit costs, or scale a sponsor's ability to win and execute on programmatic opportunities.

Proceeds Gap

Gap & Bridge Equity

Equity sized to bridge a proceeds gap between senior debt and required equity in development, value-add, and bridge acquisition business plans.

Restructure

Recap & Partner Buyout

New equity to recapitalize an aging partnership, buy out a departing partner, return capital, or refresh the sponsorship without a full senior refinance.

Execution Process

From capital need to aligned partner.

Structured equity is a partnership. We position each request around the sponsor, the project economics, the LP audience, and the path to a clean exit through the waterfall.

Define the proceeds gap

We size the senior debt scenario, model the equity required, and quantify the gap that structured capital needs to fill against the sponsor's available equity and return target.

Model the waterfall

We work through return hurdles, promote splits, accrual mechanics, current pay, and exit outcomes — the structure that protects sponsor promote and LP economics in parallel.

Position the opportunity

We frame the project around basis, business plan, sponsor track record, market thesis, leverage profile, and the realistic IRR range relative to comparable transactions.

Approach the right capital

Preferred equity programs, mezzanine funds, family offices, structured equity platforms, and institutional LPs — matched to size, structure, return target, and asset profile.

Negotiate structure

Returns, promote, control rights, transfer restrictions, exit mechanics, major decisions, removal provisions, standstill terms, and intercreditor positioning.

Close and document

We coordinate diligence, legal documentation, partnership amendments, intercreditor agreements, senior lender consents, and the funding of the structured capital.

Relevant Transaction

Preferred equity placed for a multifamily recapitalization.

Structured equity arranged by Piccard Financial

$12.50MM

Wilshire Boulevard Recap

Preferred equity arranged for the recapitalization of a stabilized mixed-use multifamily asset in West Los Angeles, structured behind a senior refinance and around a defined exit waterfall with current pay, accrual, and promote participation.

Asset TypeMixed-Use Multifamily
ExecutionPreferred Equity
Capital SourceFamily Office
MarketWest Los Angeles, CA

Related Services

Senior capital that often pairs with structured equity.

Development Capital

Construction Financing

Senior construction loans that pair with mezzanine, preferred equity, or co-GP capital to complete the development capital stack.

Explore construction →

Transitional Capital

Bridge Loans

Senior bridge debt that pairs with preferred or mezzanine equity for acquisitions, value-add, and lease-up business plans needing additional proceeds.

Explore bridge loans →

Takeout Capital

Permanent Loans

Long-term financing used to take out structured equity at stabilization, recapitalize a partnership, or refinance into a redemption-funded exit.

Explore permanent loans →

Common Questions

Structured equity questions, answered.

Direct answers on preferred equity, mezzanine, pricing, and fit — based on capital we place, not generic market copy.

What is preferred equity in commercial real estate?

Preferred equity sits between senior debt and common equity in the capital stack: it carries a priority return, no lien on the property, and control rights that typically trigger only on underperformance. It is the standard tool when senior loan proceeds fall short of the total capital need.

Preferred equity vs. mezzanine debt — what's the difference?

Mezzanine debt is a loan secured by a pledge of the ownership entity, with a stated rate and a lender's remedies. Preferred equity is an investment in the ownership structure itself, with a priority return and negotiated control rights. Senior lenders often have a strong preference for one or the other — which frequently decides the question for you.

What does preferred equity cost?

In the current market, institutional preferred equity generally prices to a low-to-mid-teens all-in return, structured as a current pay component plus an accrual. Pricing varies with leverage in the stack, asset quality, sponsor track record, and the business plan. Indicative ranges reflect recent market activity and change with conditions.

When does structured equity make sense?

When senior proceeds have gapped out — a construction budget that outgrew the loan, an acquisition where leverage fell short, a partner buyout, a recapitalization of an over-levered asset, or a maturing loan where today's proceeds cannot retire yesterday's balance. Structured capital fills the gap without a full sale.

What deal size does structured equity work for?

Institutional preferred equity and mezzanine capital generally starts around $3MM–$5MM of gap capital on transactions of $15MM+ total capitalization, though family office and private investors will consider smaller positions. Below those sizes, seller financing, partner capital, or higher-leverage senior debt is usually more efficient.

Submit a Structured Equity Deal

Send the project overview and available deal materials.

We will review the opportunity and respond with preliminary structured capital direction, likely investor audience, return expectations, structure, and next steps.

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Advisory led by Andrew Sawyer, Partner & Head of Capital Markets · CA DRE #02074085 · Piccard Financial Broker Lic. #02159069