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Mezzanine Loans in Scranton, PA

Find lenders offering mezzanine loans in the Scranton, including Wilkes-Barre, Hazleton, and surrounding areas. Compare rates, terms, and programs from 8 lenders.

Lenders
8
Typical Rate
6.75% - 11.97%
Down Payment
Often 10-25% sponsor equity
Term
5-10 years
Closing Time
30-60 days

What does the Scranton commercial real estate market look like?

Scranton's commercial real estate market has shifted from its legacy coal-mining economy to one driven by warehouse and distribution operations, healthcare, and higher education. The I-81 corridor through Lackawanna and Luzerne counties has attracted major logistics operations, including facilities for Chewy, Amazon, and TJX Companies, as distribution tenants seek lower land costs relative to the Lehigh Valley and northern New Jersey. Downtown Scranton has seen modest revitalization through historic tax credit projects converting former commercial buildings into mixed-use properties, with the University of Scranton serving as a key urban anchor. The Wilkes-Barre adjacent market adds scale, with the Mohegan Sun Pocono casino-resort and Wyoming Valley Mall submarket generating hospitality and retail demand.

Key Economic Drivers

  • I-81 industrial corridor attracting e-commerce and third-party logistics distribution centers
  • Geisinger Health System and Commonwealth Health regional hospital networks
  • University of Scranton, Marywood University, and Wilkes University providing institutional demand
  • Mohegan Sun Pocono and Poconos tourism driving hospitality property investment

Market Insight

The Scranton-Wilkes-Barre market offers warehouse rents and land costs that are 30-50% below the Lehigh Valley, making it an increasingly attractive option for logistics operators willing to locate slightly farther from the New York metro area.

How do mezzanine loans work in Scranton, Pennsylvania?

Mezzanine loans are subordinate real estate loans secured by a pledge of the borrower's ownership interests rather than a mortgage lien on the property itself. Borrowers use them when the senior lender's proceeds stop short and they want to reduce the common equity check. In the Scranton metro area, borrowers can access 8 lenders offering Mezzanine financing, including Wilkes-Barre, Hazleton, and surrounding areas. Loan amounts typically range from $1M to $100M with rates from 6.75% - 11.97%.

Who should consider mezzanine loans?

  • Large acquisitions with a capital gap
  • Recapitalizations
  • Senior-loan executions that stop short on proceeds
  • Experienced sponsors managing intercreditor terms

What are the key requirements?

  • Usually at least a $1M capital need
  • Strong sponsor track record and exit plan
  • Senior lender consent plus an intercreditor agreement
  • Debt service and leverage that still work for the full stack

Advantages

  • Can reduce the common equity check
  • Usually no direct property lien
  • Often structured interest-only
  • Can add proceeds above a senior mortgage

Considerations

  • Usually the priciest layer in the stack
  • Senior lender approval is typically required
  • Intercreditor terms can limit remedies
  • Often not a fit for small-balance deals

Mezzanine Loans in Scranton FAQ

How many Mezzanine lenders serve Scranton, PA?
There are 8 lenders offering mezzanine loans in the Scranton metro area. Loan amounts typically range from 1000K to 100M with rates from 6.75% - 11.97%.
What are Mezzanine loan rates in Scranton?
Mezzanine loan rates in Scranton typically range from 6.75% - 11.97%, though exact rates depend on factors like your credit score, the property's cash flow, and loan-to-value ratio. Down payments usually run Often 10-25% sponsor equity, and closing can take 30-60 days. Compare multiple Scranton-area lenders to find the best terms for your deal.
What is a mezzanine loan in real estate?
It is subordinate capital that sits between the senior mortgage and the sponsor's common equity. Instead of taking a mortgage lien, the mezz lender usually takes a pledge of the ownership interests in the property-owning entity.
How is mezzanine debt different from preferred equity?
Mezzanine debt is a loan with a maturity date and UCC foreclosure rights against the pledged ownership interests. Preferred equity is an ownership investment with negotiated control rights and no UCC foreclosure remedy.
Do senior lenders have to approve mezzanine debt?
Usually yes. The senior lender commonly requires an intercreditor agreement that sets cure rights, notice rules, and what happens if the mezz lender tries to enforce its remedies.
How small can a mezzanine loan be?
Published market tables still show mezzanine programs starting around $1 million. Smaller deals usually end up with more equity, a bridge loan, or a different senior structure instead.

Where else can I find mezzanine loans in Pennsylvania?

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