NEW CONSTRUCTION LOAN (SERIOUS INQUIRIES)
• Projects for $25 Million to $25 Billion.
• 75% LTC at 4.5% for 4 years • Interest only as drawn paid quarterly in arrears.
• 25% LTC cash deposited into custodial account (B of A, Key Bank, JPM) – Non-interest bearing.
• Custodial account is blocked in favor of the DEPOSITOR.
• Lender cannot lien, lever, or access the custodial account until all project costs are advanced (100%) – Deposit is always owned by the DEPOSITOR.
• Sponsor uses loan proceeds first (75%) – Deposit (25%) is then released to finish project.
• Draw caps are 25% of the deposit amount per month ($,2,375,000).
• Unused draw amounts are rolled over to the next month.
• At the end of 4 years a 25-year fixed permanent loan is offered at below market rate.
• All loans are underwritten to support the perm loan at stabilization.
• All project related expenses can be included in the total project cost (Interest Carry, Fees, Equity Pref, Land Acquisition, Pre-Development, etc.)
The Process:
- The process starts with the submission of an executive summary and proforma (CF Model).
- Introductory call with Licensed Securities Firm (Citation Capital Management).
- LOI issued by Licensed Securities Firm (Citation Capital Management).
- If Terms are acceptable sponsor signs LOI and receives invoice for application package (13,000 Euros).
- Sponsor works with Licensed Securities Firm (Citation Capital Management) completing loan package (Forms, Documents, Proof of Funds).
- Completed Loan Package is sent to Lender -Approximately 2 weeks later Lender issues Rate and Term Sheet.
- Discussions with Lender.
- Final Rate and Term Sheet issued.
- Sponsor signs Rate and Term Sheet and sets up face to face meeting with the lender.
- Sponsor pays Processing and Legal Fees (Approximately $80,000 USD).
- Sponsor Legal team works with Lender Legal team on Loan Agreement.
- Sponsor works with Banker (JPM, Key Bank, B of A) on deposit agreement (25%) -Once loan docs are signed, and deposit is made.
- First Draw is 30 to 45 days later.