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Construction
Funding

Real estate investments succeed or fail depending on the market. If you’re in a high-cost market, save money by building instead.

Up-and-coming neighborhoods can be profitable places to start a business. But, unless you already own property there, getting into the market can be tough. When the market is just too high, consider building property instead. Undeveloped land plus construction costs, in many instances, comes cheaper than developed land. You can customize your building the way you want it to make it stand out from the crowd.

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You can secure a loan using your business’s real estate
or equipment assets.

Our brokerage will connect you with loans to cover everything from buying and preparing the land to all the way through the construction phase. Whether you plan to operate out of your new building or sell it, we can help you find financing that aligns with your business goals.

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Land Acquisition and Development Loans

The one thing every construction project has in common is the need for land to build on. You can’t pour a foundation unless you have a dedicated space. Land acquisition loans let you buy undeveloped land at affordable prices. Whether you’re building on a busy street corner or alongside a rural highway, we’ll help you find the loan you need.

Development loans help you turn the land you own into a launchpad for your construction project. They cover costs like surveys, tree removal, utility infrastructure, sidewalks, and streets. Once you’re ready to get building, we can help with that too.

Construction Loans

There’s nothing quite like having your own customized space for your business. You can determine everything from how much natural light flows in, to the size of the corner office. Put in specialized structures like therapy pools, high-capacity ventilation, indoor courtyards, and ADA compliant features.

A construction loan can help you get from the planning stage to ribbon cutting. Since these loans pay on a per-milestone basis, you won’t be stuck with the full loan amount if something unexpected happens to interrupt progress. You’ll pay only the interest while the building is going up. The principal becomes due once construction is complete.

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Term-to-Perm Construction Loans

Construction loans are valuable tools for small businesses. However, some find it difficult to manage the final principal payment once the building is finished. That’s where term-to-perm loans can help. They pick up where the term loan left off and break principal payments up over the long term.

While term-to-perm loans aren’t exactly permanent, they do give business owners a much longer timeframe to work with. These loans change structure from a short-term loan that covers construction to a long-term loan that finances the property. Convert from short-term rates to a lower interest loan once your building is complete.

Owner-Occupied Construction Loans

Before a company can invest in real estate properties, it needs to invest in a home base. Owner-occupied loans are designed with this necessity in mind. Much like a standard construction loan, owner-occupied loans fund the building project from foundation to rooftop. However, the structure of the financing is a bit different.

To qualify for an owner-occupied construction loan, the business must use at least 51% of the finished building’s available space. As an occupant, your business qualifies for lower interest rates and up to 90% LTV financing. Because you have a vested interest in the property, your business is more attractive to lenders.

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Advantages

When you own the property that houses your business, you have an equity asset. You can also use the value of that real estate to secure loans for other areas of your business. Discover the benefits that real estate financing has to offer by speaking to our financial team.
Loans make construction affordable
Milestone payouts provide natural checkpoints to keep projects within scope
Funding is available for short to long-term repayment, dependent on objectives
Build equity instead of paying rent
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F.A.Q.’s

Q. What rates and terms can I get on a commercial construction loan?
Several factors weigh into the rates and terms of your specific loan. To get the lowest rates, lenders want a high credit score, a larger down payment, and a longer repayment period. However, you can still get great rates even if you don’t fit these requirements. Call us for a custom quote to find the lowest rates available for your business.
Q. What businesses are eligible for a commercial construction loan?
If you’re applying for a construction loan through the SBA, there are limits to the types of businesses that are eligible. Those that focus on gambling, religious education, speculation, and rare coins are a few the SBA won’t fund. If your business type isn’t eligible for an SBA loan, we can still connect you to a wide range of options from different lenders.
Q. How much down for a commercial construction loan?
Your down payment will vary depending on which lender funds your project. In general, down payments on commercial construction loans range from 10% to 30%. Tell us what’s in your budget and we’ll find a loan to match.
Q. What are closing costs on a construction loan?
You’ll typically have one closing cost per loan. So, if you take out a construction loan and then an end loan, you’ll close twice. If you have a term-to-perm loan, you’ll have just one closing cost. These costs vary by lender and location, so it’s best to ask your broker for specific amounts.