Bridge Loans

At Blue Heron, our goal is to offer practical, affordable, and holistic lending solutions to companies that do not meet the conventional and often unreasonable criteria demanded by banks, private equity firms or mezzanine lenders. By providing access to capital for under-served, earlier stage infrastructure projects, we are able to source transactions that are strong and vibrant, yet overlooked by traditional lenders.  Our Bridge Loan strategy is able to effectively “bridge” the enterprise on both a timing and working capital basis to then clear a path for permanent tax-exempt financing. Blue Heron then works closely with the borrower to expedite the tax-exempt financing.

We have combined best practices and industry relationships from our long careers in structured finance and high yield investing to develop a deep pipeline of high caliber projects and a resulting bridge loan program to benefit both borrowers and investors.

For our investors, the Bridge Loan strategy generates a high stream of current income that is well-secured and thoughtfully constructed.  The result is a differentiated, uncorrelated, short duration, high yield investment, one year of capitalized interest and the ability to receive first allocations on the permanent financing. There is also a make-whole provision for the first year and the underlying collateral is very strong.  We have developed a program that has an established structure, sound credit and solid underwriting principles, and we offer a compelling fee structure to help investors maximize their net returns. 

For our borrowers, Blue Heron offers practical bridge loan solutions to companies that do not meet conventional bank loan criteria, and historically relied on expensive and/or burdensome sources of capital. In parallel, we work closely with bankers to secure permanent, tax-exempt financing to replace our bridge loans and solidify each project’s future.

Blue Heron employs a thorough investment process that includes site visits and a comprehensive analysis of virtually every aspect of a given project.  The team has been practicing the same investment process for over 25 years* with our project revenue bonds, and while there are some differences with bridge loans, the essence is identical.  Blue Heron has created a working financial model that can be scaled with relative ease, creating efficiencies in terms of both costs and time.

Blue Heron has an established lending process complete with all of the building blocks that work for the full cycle – from the initial issuance, to the requisition of the proceeds, to the preparation of the take-out, to the redemption and issuance of the permanent financing.  Financial models are created by the respective management team of a given project.  These are typically sophisticated models specific to both the industry and project. 

Blue Heron reviews these carefully, stresses them, and makes any modifications to establish a conservative base case and to ensure that the model works with the size and structure of the transaction.  These models as well as management access are available to investors during the due diligence period.