Competing effectively for a purchase
A credible financing position can strengthen purchase negotiations. A bridge loan can allow an investor to proceed without waiting for long-term funding.
Service · Bridge loans
Property Bridge Loans for Professional Investors
When an acquisition opportunity cannot wait for long-term finance, a bridge loan can provide short-term, first-ranking funding with a faster lending decision. Alternate Capital structures bridge loans from €750,000 for investors, developers and condominium conversion investors in Germany, Austria and Switzerland.
The basics
Bridge loans: definition and operation
The English term bridge loan corresponds to the German Bridge finance: a property loan typically running for 6–24 months, repaid at maturity and secured by a first-ranking land charge. Providers include specialist debt funds, family offices and institutional lenders with streamlined decision processes.
Bridge lending focuses on a different assessment from conventional long-term bank finance. The key factors are property value, LTV, the sponsor and the exit. This usually costs more, but can save time that matters when negotiating or completing an acquisition.
- Bullet repayment: no scheduled principal repayments; repayment comes from the defined exit.
- Interest may be capitalised: preserving liquidity during the term.
- Partial releases: commonly negotiable where individual units will be sold.
Comparing structures
Bridge loans, bridge finance and mezzanine: the differences
These terms are sometimes used interchangeably, but their differences affect security ranking, pricing and applications.
| Financing option | Ranking | Term | Typical application |
|---|---|---|---|
| Bridge loans / bridge finance | Usually first-ranking | 6–24 months | Time-sensitive acquisitions or funding before refinancing or sale |
| Mezzanine capital | Subordinated | 12–48 months | Addressing the equity gap alongside an existing senior loan |
| Whole loans | First-ranking integrated facility | 12–60 months | The full debt requirement from one provider, with higher leverage |
If the principal issue is timing, consider a bridge loan. If the issue is complementing equity, consider mezzanine capital. If you need both within one agreement, a whole loan may be relevant. We assess the options in the initial review.
Applications
How professional investors use bridge loans
Release equity before a sale
Release funds from an existing property to secure another investment, with repayment when the first property is sold.
Acquisition through to individual unit sales
Purchase, declaration of division, refurbishment and sales: bridge funding can cover the process, with partial security releases as units are sold. See Condominium conversion finance.
Land before planning permission
A short-term facility can secure the land before planning permission and project finance are finalised. It is subsequently replaced by Property development finance .
Estates and settlements
Inheritance settlements, shareholder changes and auctions can require funding faster than a conventional process allows.
A transition to refinancing
Funding between an expiring fixed-rate period and a new structure. Further details: Refinancing and Additional borrowing.
Process
From initial contact to drawdown: an indicative timetable
Days 1–2
Key facts and initial assessment
Submit the property, amount and exit through the Initial assessment form. We assess feasibility and provide a realistic initial indication.
Week 1
Documents and lender outreach
We prepare property particulars, the land register extract, purchase agreement and evidence of equity, then approach suitable bridge lenders.
Weeks 2–3
Term sheets and assessment
Compare indicative offers, negotiate terms and coordinate valuation and legal review.
Weeks 3–6
Agreement and drawdown
The loan agreement, creation of security and drawdown are coordinated with notarial and payment deadlines.
A realistic timetable: This assumes complete documents and clear title. Contamination, unresolved inheritance matters or missing records can add weeks. We identify potential obstacles early.
Media
Bridge loan podcasts and videos
Podcast
Bridge loans / bridge finance
When short-term funding is appropriate, and the exit planning and term mistakes that can become costly.
Original recording in German.
All episodes in the Podcast hub
Original recording in German.
Frequently asked questions
Bridge loans: quick answers
What LTV will bridge lenders consider?
Indicative LTVs are 60–75% of property value. Higher levels may be possible for highly liquid locations and a strong exit, while conservative leverage can support better terms and quicker assessment.
Do I need a bank already involved?
No. Specialist lenders provide bridge loans. It is still important to consider the subsequent bank loan, sale or refinancing from the outset.
What happens if the exit is delayed?
Extension options, commonly subject to a fee, should be negotiated in advance. Interest reserves also help manage a delay.
Are bridge loans available to private individuals?
Our focus is professional and semi-professional investors with a project-related requirement from €750,000. We do not arrange ordinary homeowner bridging loans.
Comparing structures
Bridge loans or mezzanine: different funding needs
A bridge loan covers a defined timing gap, usually with first-ranking security and a specific repayment event. Mezzanine adds an equity-like subordinated layer to an existing financing structure to address the equity gap. Distinguishing the needs helps identify the appropriate option.
An investor needing to secure an acquisition while long-term bank finance is being arranged may need a bridge loan. A developer whose senior loan is agreed but who still needs the final 15% of project equity may instead need mezzanine capital.
Costs also differ. First-ranking security and a short term can make a bridge loan less expensive than a subordinated tranche, but it requires a timely, credible exit. Mezzanine capital generally costs more and can remain throughout development. Some projects use bridge funding for the acquisition and mezzanine for the development stage. We assess the actual timing and capital needs before selecting the structure.
Next step
Assess a bridge loan for your project
Property, financing amount, timetable and exit provide the starting point for a realistic initial assessment.
About the author
Jürgen Kronawitter
Jürgen Kronawitter specialises in structured real estate finance. He helps property investors, developers and portfolio owners implement complex financing solutions. His work focuses on structuring and arranging senior loans, whole loans, mezzanine capital and bridge loans, as well as tailored financing for acquisitions, investment properties, developments and refinancing. By combining conventional bank lending with alternative capital sources, he develops financing structures for domestic and international property projects.
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