Higher leverage makes deals look better on paper, but often weakens cash flow and increases risk. In this episode of the LSCRE Podcast, Craig McGrouther and I break down why we structure deals with lower leverage for better cash flow and risk management. We discuss targeting lower loan-to-value, using full-term interest-only debt, and maintaining strong coverage from day one. We explain why LTV alone doesn’t tell the full story, how amortization can compress cash flow, and why flexib...
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Higher leverage makes deals look better on paper, but often weakens cash flow and increases risk. In this episode of the LSCRE Podcast, Craig McGrouther and I break down why we structure deals with lower leverage for better cash flow and risk management. We discuss targeting lower loan-to-value, using full-term interest-only debt, and maintaining strong coverage from day one. We explain why LTV alone doesn’t tell the full story, how amortization can compress cash flow, and why flexib...
How One Simple Debt Decision Can Wipe Out Investor Returns
The LSCRE Podcast
56 minutes
2 months ago
How One Simple Debt Decision Can Wipe Out Investor Returns
In this episode of the LSCRE Podcast, Craig McGrouther and Sam Morris uncover how one simple debt decision can completely wipe out investor returns. They discuss how leverage, loan structure, and interest rate exposure can quickly turn a profitable deal into a loss – and what disciplined operators do differently to protect downside risk. Craig and Sam share insights on aligning financing strategy with investment goals, stress-testing capital stacks, and navigating the current lending environ...
The LSCRE Podcast
Higher leverage makes deals look better on paper, but often weakens cash flow and increases risk. In this episode of the LSCRE Podcast, Craig McGrouther and I break down why we structure deals with lower leverage for better cash flow and risk management. We discuss targeting lower loan-to-value, using full-term interest-only debt, and maintaining strong coverage from day one. We explain why LTV alone doesn’t tell the full story, how amortization can compress cash flow, and why flexib...
