A Smarter Approach to Private Credit
The Hybrid Debt Fund (HDF) is a smarter approach to private credit: blending the security of senior debt with the upside potential of equity participation. We provide first deed of trust loans to experienced real estate developers in high-growth markets, targeting asset classes with long-term value such as multifamily apartments, industrial, retail, and storage.What Is The Hybrid Program
- Loans up to 90% LTC
- Fixed rates loan
- First deed of trust
- Participating in 30 to 35% of the upside of reversion
- 3 to 4 year loans
- Available for construction or bridge
- Recourse until they hit DSCR hurdles
A Cornerstone to optimize investors’ portfolio risk-return profile
Why Hybrid Debt Fund
Security: First Deed of Trust Your capital is protected by a sr. lien on the property. As the first lienholder, HDF has legal authority to foreclose in case of borrower default. |
Stable Income Stream HDF offers a 5.5% preferred return, distributed quarterly. |
Equity Upside Participation After reaching cash-flowing status, LPs receive 30-35% of net operating income and a similar share of capital gains at the exit. |
Guarantor Payback Protection Each loan is backed by sponsor guarantees, reinforcing their commitment to the project’s success. |
Target Return: 11-13% Net IRR Achieved over a 5-7 year hold period, depending on loan performance and exits. |
Proven Model, Trusted Legacy Two major life insurance companies have utilized similar strategies for >40 years, providing a track record of success. |