A new company is providing commercial real estate developers with deposit financing on real estate transactions, freeing them from tapping into lines of credits or using liquidity to lock down deals.
Toronto-based FULECap provides developers deposit loans ranging from $100,000 to about $1.5 million at a cost of one per cent monthly interest for a minimum of two months, a three per cent administration fee and legal fees.
Mickey Baratz, FULECap co-founder and principal, says a client asked him more than a year ago if he could arrange deposit financing for him. Baratz, a chartered accountant and licensed mortgage broker, looked into the idea and decided it made sense. Developers he spoke to were “just floored by the idea,” he says.