Carderock Builder Capital

Carderock Builder Capital (CBC) was formed in the spring of 2017 to invest capital with residential homebuilders and land developers in for sale housing and residential lot development projects.  CBC’s primary focus is on infill homebuilding projects, residential condominium developments and residential lot development opportunities.  Capital is invested through subordinated debt, preferred/mezz equity and traditional equity deal structures. CBC seeks to turn its capital in twelve to thirty-six month project periods.

Subordinated debt is a preferred deal structure for in-fill tear down housing projects where one to three homes are to be constructed.  Under this deal structure CBC is typically paid points at acquisition, a second deed of trust is recorded against the property (generally subject to a subordination agreement with the bank providing acquisition and construction financing), CBC receives a personal guaranty and/or other credit enhancement, and interest is usually accrued  with payment at sale or loan maturity. 

Specific deal terms are based on the perceived risk of the transaction, the experience of the borrower/partner and whether CBC has successfully completed prior transactions with the borrower/partner.  While the underlying real estate is critical to CBC’s evaluation of the deal, the most important business decision for CBC is the person with whom it will be doing business.  Quite simply, CBC looks for three things in a potential partner or borrower – intelligence, energy and integrity.  If a partner or borrower does not have the third, the first two do not matter.