Trending Content - Real Estate Forum
| +111 | Is anybody just going to leave the industry? | 36 | 3m |
| +41 | CRE Recruiting for a Career - crazy? | 10 | 2h |
| +31 | Exits from REPE | 16 | 1h |
| +26 | Multifamily firms collpasing in Dallas whose next? | 8 | 2d |
| +21 | Q3/Q4 CRE Job Market Optimism (or lack thereof) | 10 | 1h |
| +19 | Arbor Realty Trust in 2026 | 10 | 19h |
| +18 | LOI Underwriting / Due Diligence | 1 | 21h |
| +15 | NYC Real Estate Job Market | 5 | 2d |
| +14 | Red Flag? Commissions-only acquisitions roles | 7 | 9m |
| +13 | Family Office vs REPE | 9 | 21m |
Career Resources
Generally the extension term for construction loans has some significant hurdles it needs to hit to be exercise-able. Usually the project needs to be complete with a certain % of units leased (in MF) or hitting a certain LTV and DSCR. Generally construction loan extensions are designed on the basis that you'll be done with the construction and for whatever reason need some time to get your perm financing. There is also more often than not an amortizing component to construction loan extension terms.
If you already new the above then in terms of modeling there's not much to it. You'll need to make an assumption about what LIBOR will be (like you have to for the original term of you construction loan) and plug in your extension fee and if applicable the amort.
If you have any specific questions I'll be happy to reply.
Agree with the above. Not that much to it other than assuming 4 or 5 year term vs. 3 year initial term, making sure you hit the extension tests, modeling in the extension fees, and make sure the loan starts amortizing down if that's how it's structured.
Got it. Thanks for the responses. In terms of modeling it, would you create an additional line item for the extension fees and some sort of =IF/THEN statement or just kind of wrap it into the initial debt service line item?
Where exactly are you getting tripped up? Just change whatever cell is driving your debt schedule...so if it's a 3 year term, but you want to underwrite an extension, change the 3 to a 4.
Voluptas laborum eius voluptates quod. Velit pariatur blanditiis tempora inventore ipsam aut. Ratione tempora rerum culpa et rerum ut similique. Architecto sapiente beatae mollitia et consequatur.
Soluta suscipit quibusdam illum et. Asperiores voluptatem quo quam iste. Id id assumenda repudiandae nihil asperiores molestiae dolorem. Aliquam possimus aliquam velit accusantium laboriosam a.
Est culpa fuga omnis in eos ea veniam eaque. Illo dolorem dolores et voluptate eius quo. Numquam quo et ut fugiat et.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...