By K2 Capital | February 12, 2026 | Credit tenant Built-to-Suit equity, 100% LTC development financing, programmatic equity
The developers we see using this capital are not struggling to get bank financing. They have established construction lending relationships and strong balance sheets. The constraint is velocity. They are developing multiple credit-tenant Built-to-Suit projects per year and funding the equity internally. As volume increases, their own capital gets stretched.
Instead of slowing down or raising equity from friends and family, there is a programmatic equity partner willing to fund up to 100% of total project cost alongside the senior construction loan.
How It Works
This is not traditional joint venture equity. There is no profit participation. It does not require second liens or complicated intercreditor permissions from the senior lender. The investment is secured by a 5% equity interest in the project LLC, allowing the senior lender’s position to remain clean.
Developers take their standard development fee during construction. Terms are typically 12 to 18 months with a six-month extension option. The capital is materially less expensive than traditional equity, starting at Prime + 5%.
In practice, this capital behaves more like structured project equity than common JV capital.
Recent Example
A developer had no trouble securing bank construction financing for credit-tenant projects. Balance sheet was healthy, relationships were solid. The issue was that funding equity across multiple projects simultaneously was consuming their liquidity.
We introduced the programmatic equity partner. The developer preserved personal liquidity, avoided dilution to outside investors, and gained a repeat capital partner capable of supporting multiple projects per year. The bank relationship stayed intact, and the capital stack was fully funded without the developer writing a check.
Designed for developers whose constraint is equity velocity, not access to debt.
| Structure | Up to 100% of total project cost alongside senior construction debt; 12 to 18 month term with one six-month extension; secured by 5% equity interest in the project LLC; no second lien and no profit participation |
|---|---|
| Deal Size | $5,000,000 to $30,000,000 |
| Best Fit Borrower | Experienced developers focused on credit-tenant projects with a strong pipeline; sponsors with established senior construction lenders; developers seeking programmatic capital to scale annual volume |
| Underwriting Focus | Strength of the credit tenant lease; balance sheet strength of the developer; clear path to completion and permanent financing |
| What Makes This Capital Different | Programmatic equity partner focused on long-term developer relationships; less expensive than traditional equity (Prime + 5%); allows developer fee during construction; clean structure that avoids interference with senior lender |
If this sounds like a fit for your situation, submit a request with some additional context. We will review it and determine whether this capital partner aligns with your situation.