Posted by John Corey on May 12, 2006 at 02:10:57:
Mike,
What sort of program allows you to provide $500K unsecured? I assume there is a credit score or something other criteria that is required.
John Corey
Financing construction on leased land - Posted by Mike
Posted by Mike on May 11, 2006 at 11:22:22:
Hi everybody. I?m in central NJ. Hot area with new homes starting price of $750K+.
I?m in talks with owner of 3.5-acre row land he wants to do $150K/year 99 years land lease with no investment on his part. Land has 350 feet main highway frontage. Engineer said I could build 25K/sf strip mall. Ones completed space will be NNN leased to tenants including my self. I will occupy up to 10K/sf. Current rates in the area $25-$30/sf plus $5/sf for common area expenses. I already have potential tenants for entire place.
The problem is no bank in the area willing to finance construction on leased land. I have about 500K of my own money for this project. Any Idea how to finance this?
Another possibility is to buy land for $1.8M but the problem is its currently zoned for small industrial. My engineer went to township and they told us we will have no problem rezoning land in question but it can take some time. Owner said if he to sell this land he will give us only 60 days for our dudiligence. But then we would have to close. My attorney would not let me sign a contract on such a terms.
Thank you all
OPTION IT - Posted by Judah hardmoney Hoover
Posted by Judah hardmoney Hoover on May 11, 2006 at 19:45:26:
The first thing you need to do is get a good mortgage broker. It sounds like mike is and I would give him a call. For what its worth?
Financing leased land can be tricky if its not the common practice in the area. You should want to buy the land anyway so you have complete control and you sound like you have the ?horse power? to pull the deal off. Why not give the seller some option consideration while you get the zoning change approved. $35k to $50k sounds right for 12 months option to purchase. Once the zoning is changed you buy it for 1.8 and the option money gets credited to you. You control the property and the seller gets his full asking price. The LAST thing you want to have happen is buy a tract of land get zoning denied and now you own land you cant use and everyone knows zoning was not approved so they don?t want to buy it from you.
I would use an option, start low work up to $50k? you have the money to avoid leased land if you structure the deal correctly.
judahh@myinnovativeloan.com
Re: Financing construction on leased land - Posted by Michael Garbush
Posted by Michael Garbush on May 11, 2006 at 19:10:22:
Call me at your convenience to discuss this project. I offer traditional financing as well as private and I also offer $500k in unsecured.
Mike Garbush
610-228-4751