Property Acquisition
Funding the purchase of an asset or portfolio where execution speed or structural flexibility is important.
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ACQUISITION & BRIDGE FINANCE GUIDE
Acquisition & Bridge Finance Guide
A practical guide to short- and medium-term real estate finance for acquisitions, refinancing, repositioning and transitional situations across European markets.
What is acquisition and bridge finance?
Acquisition finance provides capital to complete the purchase of a property or portfolio. Bridge finance is typically used where funding is required before a longer-term solution, sale, stabilisation or development milestone can be reached.
The appropriate structure depends on current value, purchase price, leverage, asset quality, sponsor strength, timing, capex, security and the proposed exit. Bridge finance is not a single standardised product: lender appetite and terms vary materially by transaction.
USE CASES
Where bridge and acquisition finance is used
Refinancing
Replacing existing debt ahead of maturity, restructuring or a longer-term financing process.
Repositioning
Capital for assets requiring leasing, refurbishment, capex or operational improvement before stabilisation.
Planning Bridge
Interim financing while planning, permits or another project milestone is being completed.
Development Exit
Short-term finance after practical completion while units are sold or the asset is prepared for investment refinance.
Capital Release
Raising capital against an existing asset where leverage, cash flow and exit support the structure.
UNDERWRITING
What bridge lenders typically assess
Current Value
The current market value and liquidity of the underlying property are central to downside protection.
Loan to Value
Leverage is considered against current value, purchase price and sometimes projected value depending on the business plan.
Sponsor
Track record, financial capacity, equity contribution and ability to execute the proposed strategy.
Business Plan
The actions required during the bridge period, including capex, leasing, permits, sales or refinancing.
Security
First-ranking mortgage or other security, guarantees and structural protections required by the lender.
Exit Strategy
A credible route to repay the bridge through sale, refinance, stabilisation or another defined liquidity event.
CAPITAL STRUCTURE
Common capital structures
EXECUTION
The exit is part of the underwriting from day one
Bridge finance is fundamentally exit-driven. Lenders need to understand not only how the facility is advanced, but how and when it will be repaid.
Typical exits include asset sale, portfolio sale, investment refinance after stabilisation, development finance after permits, or long-term bank or debt-fund refinancing. The stronger the evidence supporting the exit, the more credible the financing case becomes.
LENDER READY
Preparing a lender-ready bridge financing
Transaction Summary
Purchase price or refinance amount, financing requirement, proposed timing and use of proceeds.
Asset Information
Address, asset type, tenancy, valuation, technical information and current condition.
Sponsor Information
Ownership structure, track record, financial information and equity contribution.
Business Plan
Capex, leasing, permits, development or repositioning actions during the loan term.
Existing Debt
Current lenders, outstanding balances, maturity dates and security to be refinanced or released.
Exit Evidence
Sale strategy, refinance assumptions, projected stabilised cash flow or other support for repayment.
FAQ
Acquisition & bridge finance questions
How long does bridge finance usually run?
Bridge facilities are generally short- to medium-term. Exact maturities vary by lender and transaction and should allow enough time to execute the business plan with a realistic exit buffer.
Is bridge finance only for distressed situations?
No. Bridge finance is also used for normal acquisitions, time-sensitive completions, planning periods, refurbishment, leasing, development exit and refinancing where a permanent solution is not yet available.
Can a bridge loan include refurbishment or capex?
Yes, where the lender accepts the business plan. Capex may be funded through controlled drawdowns and can require cost evidence, monitoring and conditions before release.
What is most important in bridge finance?
Current value, leverage, sponsor quality and a credible exit are usually fundamental. A weak or speculative exit can undermine an otherwise attractive transaction.
RELATED
Acquisition & Bridge Finance
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