Condo Conversion Loans
Condo Conversion Loans are for the purpose of taking an existing multi-family apartment, or a vacant office building, or a industrial loft property and converting the use of the property to a for-sale product in the form of units for sale. Clearly, the conversion of existing rental projects is a simpler concept for lenders to grasp, with a measurable downside to evaluate.
But if the condo conversion does not work, then the property can continue to operate as a rental and can be underwritten as such. Conversely, if an office or industrial loft property conversion doesn’t work, you are left with an empty office or industrial property, not something most lenders covet as collateral.
Usually the proceeds of the loan are used for re-positioning the property, upgrading units to match competing condominium units in the surrounding market and the payoff of any existing underlying debt. Retirement of the condo conversion loan comes through the principal loan reductions as each unit is sold and a percentage of each sale after sales commissions and closings costs are applied to the principal loan balance.
The Condo Conversion Loan can also be structured for the acquisition of an existing property by a new owner for the purpose of the condo conversion and unit sales.
We will consider condo conversion loans that exhibit the following characteristics:
1. Strength and experience of the Sponsor.
2. Capital structure and contribution.
3. Entitlements including permitting.
4. Pre-Sales and marketing of the project.
5. Feasibility and competitive of the project.
The minimum loan amount starts at $5MUSD, with international loan amounts from $10MUSD and are considered on a case-by-case basis.
One Call or a Quick Application is all it takes to get started.
Finrok Group USA Toll free: (877) 982-2744 or
(866) 496-1220 ext 240 Skype: Finrokgroup
Mike McCalla, Managing Director