We have restructured what many traditional financial institutions provide and added innovative financing solutions based on our understanding of the challenges faced by many project developers in raising project financing.

You will agree with me that the approach to traditional project finance is typically expensive, painfully slow, and fraught with more than a few pitfalls, most of which go unnoticed until far too much “sweat equity” has been poured in. It is a slippery slope that involves a substantial investment of time and energy, seeking a reasonable source of funding that will come to terms and reach closing before the season’s change (again). For most private sources, or even banks, the path is highly uncertain, like walking through a forest at night with just a candle, where you only get to see the next few steps to take, and a stiff cross-wind could easily snuff out further visibility without notice.

What do we do to solve these issues?
This “pain” has been happily disrupted thanks to our next-generation model and committed Family Office investment partners that deliver a radically efficient alternative. The partners have built this funding program to specifically address these issues, “faster, easier, better”.

What makes us different?
Most project financing for new construction requires complete shovel-ready status and an on-board equity investor to take on a meaningful share of the risks. Not our partners. Through our private family office mandate, our Partners have the flexibility to fund almost any project, anywhere (except countries with US sanctions), at any reasonable stage, even if not entirely shovel-ready (our partners are willing to pay for remaining development costs) in the middle-market range of $25 million to $4 billion per project, or for a unified portfolio of projects in that range.

This proposed funding program delivers a combination of debt and equity up to 100% of the project’s budget at these indicative terms. This “hybrid” approach is unusual in project finance, as affordable debt usually requires a substantial commitment of equity from a counterparty, but here we can provide both the debt (mezzanine/subordinated) at quite affordable rates (3% APR fixed for as long as needed) and usually minority equity carried interest.

The Investment Program is based on the ability of the Project Developer/Sponsor to facilitate a capital guarantee used as completion surety in favor of our in-house capital investment partner. In turn, our investment partner covers the costs of any remaining development work as well as building and commissioning your Project. Generally, once the Project reaches the commercial operation date, the guarantee goes away – it is allowed to expire.

In essence, the capital investment partner will fund up to 100% of project costs at any reasonable project development stage, but will not accept the majority of project completion risk.

The projects are financed at these advantageous terms:

1. Speed – we complete our due diligence and offer binding terms to reach closing within 30 days. First draw of funding within 30-45 days.
2. Completion surety protects both parties’ interests and can be helpful with holding contractors and subcontractors accountable for their performance.
3. Flexible and competitive project financing terms:
   – Willing to cover costs of any remaining Project Development ahead of construction
   – Able to finance using a hybrid of mezzanine project debt and minority equity stake
   – Low-interest rate (3% APR fixed) and long tenor available – up to 20 years, can defer principal payments (interest only) for up to 3 or 4 years
   – Project “capital stack” does not include senior debt or encumber Project assets with a lien
   – Investor requires a capital guarantee to be in US$ or Euro’s, however, Project funding can be in a different currency and will not require FX risk coverage
   – Investor minority interest and non-voting board seat in a project with adequate guarantee
   – Commercial, operational, and execution risks are shared by the equity partners.
4. Minority carried interest is determined upon completion of due diligence, calculated based on:
   – Difference between the amount of guarantee and total Project funding, if any
   – Guarantee-issuing bank Credit Ratings and quality of guarantee instrument
   – Project IRR.

This Capital Guarantee structure significantly reduces the traditional administrative complexity, uncertainty and due diligence costs (and associated delays in reaching closing) that are common in most project finance.  Most common is for a Bank Guarantee or Standby Letter of Credit (BG/SBLC), though the investors also accept a Commercial Promissory Note with bank aval, or outside the US a Sovereign Guarantee.

The procedure in the streamlined form:

1. Developer presents a project or portfolio of projects to us for funding
2. We review the total required budget, uses of funds, proposed verbiage for the instrument and draw a schedule
3. We approve and pre-qualify, based on the acceptability of the instrument’s verbiage, stated uses of funds and timing of the monthly draw schedule
4. We conduct formal due diligence that puts a binding offer on the table for the loan plus equity carried interest
5. Financial closing happens quickly upon receipt of the hardcopy instrument at our bank
6. Funding flows per draw schedule
7. Project is completed, any guarantee(s) expire, with the project beginning to generate cashflows.

Please revert with any questions or when you are ready to take the next steps. admin@globalpartnerships.info