Advice Needed - Multifamily Construction Financing
My firm is considering a construction loan on a multifamily project. We are new to the construction financing arena and could use some advice.
The project is self-financed (no waterfall), the land value is about 5m and the construction hard and soft costs are about 10m.
i.e. if 75% LTC is given, does that mean we can borrow up to 75% of 15m = 11.25m? In other words we would be able to borrow more than the hard costs? What rate/terms are typical?
Also, what does the land value mean to the lender, being quite high at 50% of hard costs? Does this provide greater collateral or better lending terms?
Any insight or advice is greatly appreciated. The project is in the LA area.