Residential Construction Financing Hard to Come By

What does it take to get funding for a residential project these days? A track record, lots of pre-sales, multiple lenders and 40 percent down. That's the take-away from Michael Stoler's piece in The Real Deal yesterday. In one of the only major residential deals to get funded lately, Extel inked a $135 million construction loan from a consortium of banks to break ground on a 20-story building on West End Avenue in Manhattan; Stoler also notes that one of the Myrtle Avenue projects (our guess would be Red Apple, as Toren and Avalon are much further along ) also recently secured a $35 million construction loan. Stating th obvious, Stoler writes, "Because of the current state of the market, New York City can expect to see financing for a limited number of residential projects over the next 12 to 18 months."
Banks Only Lending to Select Group [TRD]

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Oh let's not forget Atlantic Yards and City Point (Formerly Albee Square Mall).

The What

Someday this war is gonna end...

Posted by: Return of The What at December 17, 2008 9:28 AM

why would any bank lend to developers when everyone is expecting a 20% or more hand cut coming?

Miss Muffet keep waiting and posting, your day is coming!

http://ny.therealdeal.com/articles/manhattan-home-prices-down-around-20

"Both residential and commercial real estate markets have softened substantially since the last report, most notably in Manhattan," said the edition of the Federal Reserve Board's "beige book" that came out earlier this month.

The report, which looks at market conditions in various cities eight times a year, found that "the prices of Manhattan co-ops and condos are reported to have fallen by 15 to 20 percent since mid-summer

Posted by: ZooLander at December 17, 2008 10:11 AM

Pending Irony - due to termination of 421a rather than phase our or reduction plus virtual termination of development this year and next - guess what, in two to four years we will have a shortage of for sale product again.

Posted by: chrishavens at December 17, 2008 10:48 AM

how does a supermarket king get a construction loan in this environment?

catsimatidis is the man!
all hail gristedes.

Posted by: friend_or_foe at December 17, 2008 12:22 PM

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December 17, 2008

Residential Construction Financing Hard to Come By

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