Underwrite the opportunity
We review sponsorship, property performance, business plan, and priorities before approaching the market.
Construction financing
Ground-Up Construction & Renovation Financing
Quick answer: Commercial construction loans offer 6.50% to 10.00% rates from banks for experienced sponsors, 9.00% to 14.00% from debt funds and private lenders for speculative or complex projects, and up to 85% loan-to-cost with 12 to 36 month interest-only terms funded through progressive draws. Lender selection drives pricing more than any other loan type: the same project can price 300 basis points apart depending on whether it fits a bank credit box or requires private capital.
NationwideMarket coverage
1,000+Capital relationships
$2MM+CLS engagement floor
24 hoursInitial response
When it fits
When Construction financing fits.
Construction financing is inherently higher risk than permanent lending, which means lender selection and deal structuring are critical. Experienced borrowers with strong track records can access competitive bank construction loans, while more complex or speculative projects may require debt fund capital. Key considerations include loan-to-cost ratios, interest reserves, completion guarantees, and the exit strategy, whether that's a permanent loan take-out, sale, or refinance.
Structure before pricing: leverage, recourse, reserves, prepayment, and closing certainty can matter as much as the headline coupon. We test those trade-offs before recommending a path.
01
Ground-up apartment developments
02
Industrial warehouse construction
03
Build-to-suit retail and office
04
Hotel development and rehabilitation
05
Fix-and-flip residential projects
06
Major property renovations and repositioning
Lender selection
How We Source Construction Capital
We do not treat the lender list as a directory. We target the desks whose current appetite fits the asset, sponsorship, market, and business plan, then compare the full execution, not only the rate.
| Capital source | Where it may fit |
|---|---|
| Banks | Relationship-oriented capital that can offer local market knowledge and structural flexibility, with recourse often considered. |
| Debt Funds | Flexible capital for transitional, complex, leveraged, or time-sensitive executions where conventional credit boxes may not fit. |
| Private Lenders | Flexible capital for transitional, complex, leveraged, or time-sensitive executions where conventional credit boxes may not fit. |
| Credit Unions | Relationship-oriented capital that can offer local market knowledge and structural flexibility, with recourse often considered. |
| CDFI Lenders | Mission-oriented capital that may support eligible communities, sponsors, and projects outside conventional lender criteria. |
| Lender type | Indicative rates | Typical leverage | Best fit |
|---|---|---|---|
| Banks and Credit Unions | 6.50% to 10.00% | 65 to 75% LTC | Experienced sponsors, pre-leased or de-risked projects, full recourse typical |
| Agency and HUD-Backed (Multifamily) | 6.50% to 11.00% | Up to 85% LTC | Ground-up apartments, affordable housing, construction-to-perm executions |
| Debt Funds | 8.00% to 12.00% | 75 to 85% LTC | Value-add and spec projects, sponsors needing speed or higher leverage, non-recourse available |
| Private and Hard Money Lenders | 9.00% to 14.00% | 65 to 75% LTC | Land and entitlement-stage deals, credit-story sponsors, fastest close |
How we work
One process. Multiple capital sources.
We position the transaction, identify the lenders most likely to compete, and compare proposals on economics and execution risk, not just headline rate.
A well-structured financing process should create real choices for the borrower, not simply deliver the first term sheet.
Target the right lender desks
The transaction is matched to lenders whose current appetite fits the property, market, and structure.
Create a comparable field
Proposals are evaluated across rate, proceeds, recourse, reserves, prepayment, and closing certainty.
Manage execution through closing
We coordinate lender diligence, third-party reports, and issue resolution until the loan funds.
Selected closings
Construction financing in practice.
National reach
Market knowledge where the deal requires it.
We arrange construction financing nationwide while matching each transaction to capital sources active in that market and property type.
Atlanta, GABoston, MAChicago, ILDallas, TXDenver, COHouston, TXLos Angeles, CAMiami, FLNashville, TNNew York, NYPhoenix, AZSan Diego, CASan Francisco, CASeattle, WATampa, FL
Browse all markets →
Questions
Construction financing, clarified.
The final structure depends on the asset, sponsorship, and market. These are the starting parameters we discuss most often.
Working out equity? Our commercial property down payment guide covers typical requirements by loan type: 20% to 30% conventional, 10% for SBA owner occupied.
Commercial construction loans are short-term facilities (12-36 months) that fund the development of new buildings or major renovations. The loan is drawn in stages as construction milestones are completed, with interest-only payments during the build period. Upon completion, the borrower refinances into permanent financing or sells the property.
Construction loans typically offer 65-80% of total project cost (loan-to-cost or LTC), depending on the lender, borrower experience, and project type. The remaining 20-35% must come from borrower equity, though mezzanine or preferred equity can fill part of the gap.
Most lenders require borrowers to demonstrate relevant development experience for construction loans. First-time developers may need to partner with an experienced co-sponsor or general contractor, or work with private lenders who are more flexible on experience requirements.
Construction loan rates typically range from 6.79% to 13.04%, depending on the lender type and project risk profile. Bank construction loans for experienced developers are at the lower end, while debt fund and private lender rates are higher but offer more flexibility.
A construction-to-permanent loan (or mini-perm) combines construction financing with a built-in permanent loan conversion upon project completion. This eliminates the need to refinance separately, saving time and closing costs, though terms may be less competitive than standalone permanent financing.
Construction loan draws are released based on completed work verified by an independent inspector. The borrower submits draw requests with supporting documentation, the lender's inspector verifies the work, and funds are released (typically within 5-10 business days). An interest reserve is usually built into the loan to cover debt service during construction.
Let's evaluate the right construction structure.
Share the property and financing request. We will respond within 24 hours with an initial view.