NEW YORK CITY-Location is extremely important when it comes to returns on real estate mezzanine loans, experts at the 2^nd annual Real Estate Mezzanine Finance Summit said today. And it’s even more important when it comes to seeking this type of financing to secure and recap busted development deals.

The forum focused on all aspects of real estate mezzanine loans and took place Wednesday at the Waldorf Astoria. Speakers brought a variety of investment perspectives. But as the market for real estate investments continues to improve, many focused on the bottom line – how to finance, then eek out returns in a still-shaky environment.

At the morning’s second panel, which focused on risk levels for mezzanine loans, Starwood Capital Group SVP Cary Carpenter said that he sees financing opportunities as a market-specific question. “If you’re talking Tulsa, OK the answer is no,” Carpenter said. “What comes back first tends to come back out of Manhattan, DC, San Francisco, and the west side of LA. Over time, people tend to push further out.”

Panelists tended to agree, however, that there was equity floating out there to be had. “There is a lot of equity available,” Bruce Batkin, president and CEO of Terra Capital Partners told the audience at an earlier panel. He added that his firm was quite comfortable now lending in secondary and sometimes tertiary markets. Actual returns were another question altogether, with restricted cash flow, Batkin said, remaining an issue.  “In terms of the potential returns on equity today, other than value add situations, we don’t see them as particularly attractive.”