Mezzanine to Total Capital measures the proportion of mezzanine finance within the overall capital structure of a UK property development project. Mezzanine funding, a hybrid of debt and equity, sits below senior debt but above equity in the capital stack and typically carries higher costs due to its subordinated position. This ratio helps UK property developers understand their reliance on mezzanine finance, which can bridge funding gaps without diluting ownership significantly. While a higher proportion may increase financial risk, it allows developers to undertake larger projects with greater leverage and flexible financing options.
This sits beneath Subordinated/Mezzanine Debt, introducing a more specific variant of the measure without changing its core interpretation. It is commonly considered alongside Subordinated Debt to Total Capital, as both are closely related measures used to assess similar aspects of performance or risk.
View glossary entry