When we are talking about multi unit, this can relate to both a single structure with more than one living or commercial rental unit, and a builder or develop that is building out several single occupancy dwellings in one location.
The most common request for financing we get is for multi unit construction projects greater than 10 units, but we can accommodate financing requests for smaller numbers as well.
The construction financing market for multi unit projects has basically three tiers to it.
At the lowest risk range, there are bank and institutional lenders. Slightly higher risk are the sub prime leaders that are one notch below the institutional lending rates. And the last category is the private mortgage lenders who tend to command slightly higher rates, but also provide added benefits with respect to their flexibility in both the application and draw management process.
For larger projects above 20 units, we also have access to supplier sources for windows, flooring, fixtures, and so on, that can potentially save from 20% to 35% on your project. All materials comply with Canadian building standards and are sourced from overseas.
Because of the variety of lending sources that are available to a multi unit construction project, its going to be important to get a good match between the project and a specific lender so that the cash flow requirements can be met without delay or issue during the project.
Sometimes the best fit isn’t the lowest cost option either, as lower cost lenders can have very stringent draw requirements that may be difficult to match over the life of your project.
Our goal is to develop a detailed understanding of your project and then discuss with you the different approaches to financing that are going to be available to you as well as the pros and cons that go with them.
Once construction financing is put into place, we stay with you through out the project to assist in any administration details that might have to be dealt with or funding issues that need to be ironed out.
If a financing exist strategy is required at the end of the project either for a construction inventory loan or a take out mortgage for either your clients or yourself, we can also help to get the necessary construction or construction related financing arranged through our broad spectrum of bank, institutional, and private lending sources.