Non-Recourse A & D Land Loans
Loan Amount: $2M - $40M+
Term: Up to 5 Years
Rate: 9.25% and up
Origination Fees: 2-4%
LTC: Up to 80%
Comment: Lot developers use high LTC non-recourse A & D land loans, along with their builder deposits to close with little to none of their own cash at closing. With potentially 100% of the capital stack financed, developers can close without an equity partner, and keep 100% of their profit.
Non-Recourse Land Loans - Quick Close Scenarios
Loan Amount: $2M - $40M
Term: 1 to 2 Years
Origination Fees: Risk Adjusted
LTC: Up to 75%
Appraisal: Not Required
Recourse: Often Non-Recourse
Closing Time: Typically 2 to 4 weeks, but 1 week close possible
Comment: Ideal for early stage land loans without builder contracts. Ideal for quick closes, return of equity (cash-out) and special circumstances.
OBS* Land Banking - 90%
Investment Amount: $2M – $10M of Peak Investment Per Project
Builder Deposit: 10% of Acquisition & Development Cost
Term: 12 - 42 Months
Option Fee Rate: 16% Payable Quarterly
Personal Guarantee: Non-Recourse
Builder Contract: Option Contract - No Specific Performance
Builder Deposit - due when funds are needed: Builder only funds 10% deposit as funds are needed, not all at land acquisition.
Minimum Term: No Minimum Term, Builder may buy early without penalty.
Investor Minimum Return: No Minimum Return or Interest or Multiple
Profit Participation: $0
Origination Fee: $0
Brokerage Fee: $0
Investor Legal Fee: $0
Site Visit Fee: $0
Appraisal Fee: $0
Other Closing Costs: $0
*Off Balance Sheet
Comment: Builders and large developers use OBS to minimize equity requirements. There are no minimum returns, multiple requirements, or hidden fees and builders can buy lots back early with no penalty.
Non-Recourse Land Acquisition / Construction Loans for Multi-Family Developers
Loan Amount: $10M - $50M
Term: Up to 3 Years
Rate: 7.5% +
Origination Points: 2-3%
LTC: Up to 80%
Recourse: Non-Recourse, standard carve-outs
Comment: Adaptive reuse and condo projects considered.
****Other Asset Classes
Land Finance Group strives to provide the gamut of land loans, often characterized by risk. We also entertain other risk-based loans, such as existing office/mixed - optimal for private funds - EB-5's, resorts, Caribbean projects, brownfields, bankruptcies, or new technology businesses with a real estate component.
Contact Kyle Poole to discuss specific scenarios - 202-244-3000 / firstname.lastname@example.org