A measure of the cash flow available to pay the mortgage. A DSCR of 1.25 means the property earns 25% more than its debt obligations.
CRE deals are often layered. The "Capital Stack" describes the priority of repayment. At the bottom is Senior Debt (the safest position), followed by Mezzanine Debt or Preferred Equity , and finally Common Equity at the top. The higher you go in the stack, the higher the potential return, but the greater the risk of loss if the project fails. finance commercial real estate
The traditional route for construction and bridge loans. A measure of the cash flow available to pay the mortgage