LOS ANGELES—Eagle Group Finance has funded three short-term non-recourse bridge loans totaling $20.4 million. These loans, according to Brian Good, Eagle Group Finance CEO, echo the demand for private financing in both strong and weak markets.

“Private financing like ours has been around for a very long time. We are not trying to reinvent the wheel, just improve upon the process,” he tells GlobeSt.com. “There is always a need for private financing in good times or in bad times. There is always a distressed situation or distressed borrower who cannot, for whatever reason, go to a bank for a loan. There is about $400 billion of private financings on commercial real estate in the U.S. This number stays pretty consistent over the years whether the capital markets are frothy or not. There is never a single dominant private lender because it is simply too big of a market.”

The largest loan funded is a $7.9 million loan used to finance the renovation of a 38-room boutique hotel in West Los Angeles. The renovation includes redesigning the hotel entrance, landscaping and a redesign of the outdoor area. The proceeds from the loan will also reimburse the borrower for a recent redesign of the hotel façade. The two loans remaining are valued at approximately $6.2 million each. West Jordan, a developer borrowed the funds to refinance the Falls of Elk Grove in Sacramento County, which will, in part, pay for remaining construction on the property. LA Fresh Flower Mall received the final loan to pay off a discounted note used to secure the property.

“Bridge financing is typically a good fit for borrowers who have transitional properties, which simply means they haven't quite finished their business plan,” Good says about why the borrowers chose this financing structure. “If they went now to a traditional lender on a 10-year loan, they would not be able to get the maximum dollars they desire.”

For Eagle Group, these borrowers were a good fit because of the company's asset-focused strategy. “Because we are a low-leverage asset-based lender, we focus on the value of the property first and foremost. At the low basis we were lending to, we have some flexibility if the borrower is not an ideal credit or had some issues in the past. We do not need a high net worth, personal guaranty, or lock box to meet our underwriting parameters,” he explains, adding the lender likes Los Angeles properties, especially downtown of in West Los Angeles.

Recently, bridge lending made other headlines on GlobeSt.com when reporter Erika Morphy looked at the possibility of rising interest rates due to excellent employment numbers.