Capital Stack
The capital stack is the layered set of funding sources used to finance a real estate asset, typically ordered from lowest risk/lowest return (senior debt) to highest risk/highest return (common equity). Each layer has different payment priority and control rights, and the structure determines how cash flow and proceeds are allocated.
- Where it applies
- Generally, not specific to New York
- When it comes up
- Acquisition structuring; recapitalization; refinance; workout
- Property types
- All investment real estate
In practice
"Capital stack design" is a control-rights problem as much as a pricing problem; remedies, consent rights, and cash-management triggers can dominate outcomes in stress.
Read more in the Knowledge Base
Related terms
Capital Stack and Structured Finance
- Common Equity
- Cure Right
- Intercreditor Agreement
- Mezzanine Debt
- Mezzanine Financing
- Preferred Equity
- Standstill Period
General information, not legal, tax or financial advice.