Capital Stack Modeling & Advisory

Most developers understand their deal at a high level — they know the land cost, the construction budget, and the projected sale price. What they often lack is a precise, dynamic model of how the capital layers interact: how senior debt coverage ratios constrain your loan amount, how mezzanine pricing affects your equity returns, how C-PACE proceeds change your senior debt sizing, and how tax credits can be monetized to reduce your equity requirement.

These interactions are not intuitive. A 1% change in your senior debt rate can cascade through the entire stack, changing your equity IRR by several hundred basis points. A C-PACE tranche that covers 25% of hard costs can reduce your equity requirement by 30% or more — but only if it's modeled correctly and presented to your senior lender in a way they'll accept.

Bonica Capital Advisory builds models that capture these dynamics precisely — so you walk into every lender conversation, equity raise, and partnership negotiation knowing exactly where you stand and what leverage you have.

Our capital stack modeling service covers every layer of the modern real estate capital structure. For senior debt, we model loan-to-cost and loan-to-value constraints, debt service coverage ratios, interest reserves, and recourse provisions. For construction loans, we model draw schedules, interest carry, and the transition to permanent financing.

For the mezzanine and preferred equity layers, we model coupon rates, accrual structures, profit participation, and waterfall mechanics. We show you exactly what each tranche costs on an all-in basis — not just the stated rate, but the effective cost including fees, points, and participation.

For tax credit and incentive programs — including Section 45L new construction credits, Historic Tax Credits, New Markets Tax Credits, and Opportunity Zone structures — we model how credits are generated, how they flow through the ownership structure, and how they can be monetized or sold to reduce your equity requirement.

The output is a single integrated model that shows every stakeholder — your senior lender, your equity partner, your mezzanine provider — exactly how the deal is structured and why it works.

Commercial Property Assessed Clean Energy (C-PACE) financing has become one of the most powerful tools in the modern developer's capital stack — but most developers either don't know how to model it or present it to their senior lender in a way that gets approved. Bonica Capital Advisory specializes in C-PACE integration as part of a broader capital stack optimization.

We model C-PACE proceeds, assess the eligible cost basis for your specific project type, structure the intercreditor agreement in a way senior lenders will accept, and show you the net effect on your equity requirement and returns. In many cases, a properly structured C-PACE tranche can reduce equity by 20–35% while improving overall project returns.

See our dedicated C-PACE Advisory page for a full breakdown of this service.

Every capital stack modeling engagement delivers a fully dynamic Excel model with clearly labeled inputs, assumptions, and outputs — built to be presented to lenders and equity partners without modification. We also provide a one-page capital stack summary suitable for inclusion in an investor deck or lender package, and a written narrative explaining the structure and the rationale behind each decision.

For clients raising equity or preparing an Offering Memorandum, we can extend the engagement to include full waterfall modeling, investor return projections, and LP/GP split analysis. These deliverables are built to the standard that institutional equity partners and family offices expect to see.