Glossary

Warehouse Line (Warehouse Facility)

Also known as: Warehouse Facility, Repo Facility

A short-term, revolving credit facility that a debt fund or bridge lender uses to fund newly originated loans before they are aggregated and permanently financed through a CRE CLO issuance, loan sale, or other term facility.

Warehouse lines are typically provided by large banks or broker-dealers and are secured by the originated loans themselves, advanced at a margin below the loan's face amount (the warehouse "advance rate"), with the originator funding the remaining equity. Because warehouse facilities are short-dated and often subject to mark-to-market margin calls, they expose the originator to funding and liquidity risk if loan values decline or if the CRE CLO or takeout market seizes up before the facility matures — a dynamic that became acute for bridge lenders during periods of capital markets dislocation. Warehouse capacity is a key operational constraint on a debt fund's origination pace, since a platform can only originate as fast as its warehouse lines (and eventual permanent takeout financing) allow.