Construction Financing - What are lenders requiring for a contingency these days?

Assuming plans are 100% complete and fully bid out, and developer is 90 days from breaking ground.  What are lenders requiring as a % contingency on hard cost budget (and soft costs too, if required) as part of their underwriting?  And does it depend on whether the lender is a traditional bank vs a debt fund/non bank source?

I have heard in the past anywhere from 5-10% on hard costs and up to 5% on softs, but wanted to see if anyone had current (2023) data.  Thanks!

8 Comments
 

Still seeing 5% Owner Hard Cost Contingency in addition to the GC's contingency (we are a developer doing projects $50MM+ in total cost)

 

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