How can brokers capitalize on this new information?
First, when talking to your developers or real estate brokers, let them know that you understand how municipal debt can benefit them. Approach them with the idea of looking at the issuance of municipal funding to increase their overall return on investment on a project. Dust off some of those projects from your filing cabinets — the ones that never seemed quite feasible before — and look more closely. Will the addition of the issuance of municipal debt now make a project go?

Many times, when developers approach a public agency for their maps, they come up against extraordinary mapping conditions, which translate into more costs and a resulting lower profit margin. Therefore, they are forced to abandon their dream project. By analyzing how municipal debt can help alleviate these costly increases, a project may make more economic sense.

Brokers for developers’ private funding can have a captive client. Once you line up the acquisition-and-development loan and the construction loan for them, the rest is up to your perseverance and creativity in closing the loans.

Harlan A. Friedman, Esq., is president of Lightning Commercial Funding Inc., a California mortgage broker. He has more than 20 years of experience as an investment banker and financial consultant, issuing municipal debt for his clients. Lightning Commercial Funding specializes in financing commercial projects exclusively, from the startup of new business to large commercial transactions. Reach Friedman at (858) 486-3076 or harlan@loanforbiz.com. Visit his company at www.loanforbiz.com.

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