In working with some of my institutional lenders, I have been given access to some terrific new programs to cater to the loans that banks are no longer making. There are about three different programs that should be very useful right now to real estate professionals. These loans are very competitive and I am really excited to get them in front of the local bankers.
The first is a triple net construction loan on investment grade type commercial properties. They are willing to go up to 90% leverage on the loans. The loans can range in size from $10 million to $40 Million with the sweet spot primarily in the $25-35 Million range. I have a friend that does Walgreen's new construction but I don't know if they will meet the price range. I don't know if he needs them either. He mentioned that Zion's couldn't help him any longer.
Income producing properties is where I need to be located right now. We have a new program for post construction loans where the bank isn't renewing the loan for the leasing phase. The loan program is for 2 year loans and range in size from $5-40 Million. The ltv is between 50-75% but that might not be too difficult to given the value created following construction. Properties in default are ok as well but the yields will be higher (14-16%).
Lastly the 3rd program is for permanent loans. Hard money loans that are "permanent" means 5 to 7 years and the rates are around 7.5 to 8%. That's not bad at all. We are looking for portfolio product. Therefore the properties need to be in good shape. Given that it is hard money, these rates are amazing. I just need more deals! I'll start calling tomorrow.
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