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Apartment Construction Loan


Looking for commercial construction loans or apartment construction loans? Are you looking to build an apartment, office building, a mixed use, retail center, industrial building, or any other type of commercial property? We've been in the commercial real estate financing business since 1977 and can help! Ocean Pacific Capital is your source for access to the best financing programs from the most aggressive apartment construction investors in the world. When you make the decision to finance your apartment with us, you ensure you are getting the best rate and terms this market has to offer.

The process to obtain an apartment construction loan can be a complex process, which involves several tests. You need our trusted expertise and years of experience to guide you through the process. The first test is the profit test, which will determine an estimate of the value of your finished project and if it will be worth more than it will cost to construct. Similarly, a Loan-to-Value Ratio test will determine, once a project is completed and the commercial property is occupied, the construction loan will be a certain percentage loan-to-value. Most construction lenders will permit up to 80% loan-to-value, which will depend on the borrower's credit, cash flow, and various other factors. Depending on the borrower's qualifications, additional equity may be obtained through a mezzanine loan.

Commercial construction lenders and apartment construction lenders often rely on the loan-to-cost ratio as they do not often trust the appraisal of the building. The loan-to-cost ratio is the calculated percentage of the total cost of the project that the construction lender is being asked to loan or cover for the construction of the project. Normally, developers cover at least 20% of the total cost of the project in the form of free and clear land. However, if the apartment construction loan or commercial construction loan is up to or more than 90% of the cost, the lender will require that the developer obtains more leverage.

The developer may obtain more leverage through a mezzanine loan. When planning construction of an apartment or a commercial property, something to consider is how much the money the property will bring in (income) to qualify for a takeout loan. If a takeout loan is large enough it may be able to pay off the construction loan, allowing the apartment construction lender or the commercial construction lender to get out of the deal. To determine whether or not the takeout loan will be large enough to pay off the apartment construction loan or the commercial construction loan, the construction lender will calculate the Debt Service Coverage Ratio. This ration should be larger than 1.25 and the net income from the project must be larger than 25% than the proposed payments of the loan. The net worth-to-loan size ratio is also important to the construction lender, whether it is an apartment construction loan or a commercial construction loan because the developer's net worth should be at least as large, if not larger, than the loan amount of the project.

For over 31 years, with the lowest and most competitive wholesale rates in the nation, rebate pricing, 80% LTV, 30 years amortization, interest only, and no balloon payments, our programs are the most desired and the first choice of borrowers nationwide. Loan amounts are available starting from $500,000 with no upper limit. We specialize in wholesale commercial loans, wholesale conduit loans, wholesale apartment loans, wholesale apartment financing, wholesale apartment lending, wholesale apartment refinancing, wholesale mixed use loans, and wholesale apartment purchase loans.

We understand what it takes to close a commercial loan because this is what we've been doing since 1977. And as always, we strive to exceed our client's expectations. Our responsibility is to get your loan processed, underwritten and closed in a timely fashion. If you are unsure about the process of obtaining a commercial loan, let us help you. Our commercial loan specialists will be more than happy to answer any questions that you may have. Call us today at 1-800-595-1474 to get started!


Whatever your financing needs,
we will tailor a loan that's right for you.

 

Commercial News for 7/25/14

WSJ.com: Commercial Real Estate

A Power Surge in the Rust Belt
General Electric cut a deal with county and city officials to move a number of operations?including human resources and finance?to a new $90 million facility in downtown Cincinnati on the banks of the Ohio River.

New Lenders Enter Property Market and Think Small
As the economy improves, lenders see loans for smaller properties as less risky. And with less competition, interest rates and potential profit can be higher.

Plots & Ploys
Money from China has been a top driver of some housing markets, especially in coastal cities such as San Francisco and Los Angeles. But that spigot may soon tighten.

Queens Project Stirs Worry That Residents Will Be Priced Out
New York City Mayor Bill de Blasio's affordable-housing ambitions are being tested by the first major project he has shaped from its early stages, a 2.2-million-square-foot development on the Queens waterfront that is raising fears of Brooklyn-style skyrocketing rents.

Property Investors Unfazed in Puerto Rico
Puerto Rico's deepening economic troubles have punished investors and made life hard for many locals. But one group has been encouraged by the opportunities it sees: real-estate investors.

A Tech Hub Treads in a Sea of Bureaucrats
Vornado Realty Trust is embarking on an experiment to create a cluster of technology companies amid its 7.3 million square feet of offices in Crystal City, Va., home of defense agencies and government contractors.

Sale-Leasebacks Ease Italy's Real-Estate Jam
Deals have begun to flow out of two funds that were set up by the Italian government in 2004 to do sale-leasebacks of government-owned property.

BRE #:00619059
Charles Elfsten, President
Charles A. Elfsten
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