Loan – Evan Seiden

What a High Debt-To-Equity Ratio Could Mean

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A real estate investment executive based in Florida, Evan Seiden, FL, graduated from Connell University within three years a rare achievement. Evan Seiden, FL, managed the real estate investments of Lone Star Funds. His focus encompassed commercial real estate equity and debt acquisitions.

A Florida-based real estate investment executive, Evan Seiden, FL, manages Relentless Capital, LLC. Evan Seiden, FL, has identified, negotiated, and structured large commercial real estate debt with several of the largest firms in America. Among the tools real estate professionals use is debt-to-equity ratios.

The debt-to-equity ratio, or D/E ratio, evaluates the financial leverage of a company based on its debt. High dividend yields and revenue stability attract investors to real estate companies, but investors still evaluate the potential risk. Real estate companies buy properties, and these transactions require enormous upfront investments, which are funded through a combination of debt and fresh equity. The D/E ratio divides a company’s total liabilities by the equity provided by the stockholders. If the ratio is high, it means the company took an aggressive debt position, which in a market downturn which is generally coupled with high vacancy rate/decreased revenues can lead owners to loose the properties and hand the keys back to the bank wiping out their initial equity.

Several industries use the D/E ratio as a metric. How the ratio is evaluated varies by sector. The lower the ratio the better able a property or firm will be to withstand a market downturn.

Debt-to-Equity Ratios in the Real Estate Sector

A Florida-based real estate investment executive, Evan Seiden, FL, manages Relentless Capital, LLC. Evan Seiden, FL, has identified, negotiated, and structured large commercial real estate debt with several of the largest firms in America. Among the tools real estate professionals use is debt-to-equity ratios.

Several industries use the D/E ratio as a metric. How the ratio is evaluated varies by sector. The lower the ratio the better able a property or firm will be to withstand a market downturn.

Why is Debt Cheaper than Equity?

An executive in the real estate sector, Evan Seiden, FL, leads Relentless Capital, LLC. Previously, Evan Seiden, FL, sought opportunities for Lone Star Funds as manager of real estate investments. He participated in more than $1 billion dollars in commercial real estate debt and equity acquisitions in the past decade.

When a company needs capital, there are two main funding options – contribute/raise Equity capital or obtain debt. Debt funds an expansion or acquisition of real property without diluting ownership control. Also, interest only debt service (interest loan payments) are tax deductible. Equity, when provided by investors, generally incurs a preferred return whereby investors receive their money back plus a set return before the operating partner receives a share of profits and dilutes one’s ownership percentage.

Entrepreneurs often refrain from financing growth through debt. However, industry insiders point out it is not the same a maxing out personal credit cards. Additionally, debt financing offers distinctive benefits such as tax benefits, an ability to expand without giving up ownership and retaining full management decision making control.

Getting Started in Commercial Real Estate Investment

After graduating from Cornell University, Aventura, FL, resident Evan Seiden spent 3 years as a manager of real estate investments with Lone Star Funds. Serving as the chief executive officer of Relentless Capital since 2017, Evan Seiden identifies and negotiates commercial real estate investment opportunities in the southern part of FL state.

Success in the profitable business of commercial real estate requires a breadth of knowledge and experience. Like any professional endeavor, due diligence is a key aspect in getting started. First, investors should understand how the commercial real estate market differs from the residential market. Typically, higher income potential results from longer leases and property values calculated according to usable square footage.

To make prudent decisions, investors should analyze comparable properties in the area to gauge the current market value of the property, and research future developments to predict how those values might change. To calculate all costs as precisely as possible, investors must consider operating fees such as utilities, insurance, repairs, and property tax. After identifying a promising property, investors should consult trusted financial advisors to ensure they receive the best commercial real estate loan rates possible.

A Look at Commercial Mortgages

Business executive Evan Seiden, a resident of FL, graduated a year early from Cornell University before beginning his work in the real estate investment industry. Evan Seiden serves as Chief Executive Officer of Relentless Capital in Miami, FL.

Recently, Relentless Capital closed on an approximately 600,000 square-foot industrial property in Miami-Dade County. The property, which consists of three warehouses in addition to parking for trucks and heavy equipment, sold for $12.5 million in an off market transaction.

Commercial mortgages refer to loans used to secure commercial land or property, such as warehouses, apartments, or shopping centers. Lenders for these types of loans range from traditional banks and asset backed trusts to life insurance companies and government sponsored enterprises.

Commercial lenders typically require personal and business tax returns in addition to business records and bank statements before approving a new mortgage. Outside these standard requirements, applicants typically must provide information on all partners and managers involved in the operation of the business. In addition, commercial lenders require a comprehensive business plan that includes projected earnings to ensure the health and viability of a company seeking a commercial loan.

Once all the required information is collected, commercial mortgage underwriters complete a thorough review before either approving or denying the loan.