Peak debt
Peak debt is the largest senior debt balance reached at any point during the project's life — usually just before the first settlements drop the balance back down.
Formula
Read straight off the monthly cashflow.
Why it matters
The senior loan facility limit is what the bank approves. Peak debt is what the bank actually has at risk. They are not always the same — a project can have a $20M facility and only ever draw $17M of it. Peak debt is what tests against LTC and LTV covenants in real life.
Worked example
If the Waterloo scheme draws debt evenly through construction and pays down on settlements, peak debt typically lands at $16.4M — just below the $17M facility limit, and just before the first settlements drop the balance.
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