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Originally posted by Dharma

Any lenders on here who would do a 50% LTV land loan in AZ?
It is zoned commercial by an airport.
6M loan amount
Full file
good exit strategy

Client/Borrower: Both of the clients have been lifelong investors/entrepreneurs/developers. The clients credit scores range from one having 600 FICOs’ to the other having 750+ ficos. The clients have extensive wealth and have ownership of several buildings, and more than a million dollars liquid in reserves. Additionally, they have 25+ years of real estate ownership and development experience.


Collateral: The project or property, which will be securing the loan, is 75 acres of highly regarded land located next to Buckeye Airport in Scottsdale, AZ that has municipal, state and federal strategic implications. The property is estimated to be valued in the $15mm range. All sources are indicating the required expansion of the airport which is become the Phoenix areas “second” airport over the next several years. This land will have great development value for hangers, warehouses, retail, parking, etc that will be vital to the airports planned expansion. Another real value to the land is added by the “water rights” that the land offers. The land has full water rights and in fact will contracting with the airport for shared use of water. The land is owned free and clear. The client purchased the land in 2003 for $1.7mm according to deed records. Granted the market has is going through a depreciating environment. This land was purchased with the very gamble in mind that in a set period of years the collateral would become required for government use and expansion of a current airport. As to personal security instruments…the clients would not be opposed using personal assets as a method of “cross collateralization”.


Loan Vitals: The client is interested in borrowing $6-8mm, which would
be a 40-55% LTV. (The ltv is based on acreage in the area rather
of comps from other surrounding airports. Airport acreage is more
in the neighborhood of $8 per square vs. the $5 mentioned on the
appraisal)

Use of Funds: The client will be using the proceeds from the loan to pay off the other partners ($6.5mm) and develop the land with some infrastructure, commercial (airport type i.e. warehouse and hangers) buildings. Upon paying of the partners…the client will be able to better access personal or other funds via local banks, etc to complete and any further expansion.


Exit Strategy: The clients has many exit possibilities…the last being the ability to sell for a large amount of profit. They will soon have in place a contract for sale of 12 acres of the land for the immediate expansion of the runway. This will net in the range of $2.5mm. The infrastructure that is then put in place with the planned development will allow for the refinance of the property in a better credit environment.

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Originally posted by Dharma

Thanks Kyle. I appreciate your input.

I am doing this for a friend(really a friend..not trying to steal his deal). He has it with a lender for 8 pts...( whithout his points) . I was just hoping he will get a better deal. If I can't find better he will most likely close it but it is way too expensive. Anyways,I will not spend much time on it. I will let him deal with who ever says they are interested in the deal.he can judge if it is worth his time. Thanks.

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Originally posted by dkendall1979

I'm a gambling man.

I'm willing to put good money that it won't close with the mysterious "other lender" charging 8pts.

There isn't a patch of dirt in this country that's appreciated 1000% in 5yrs time, especially since the last 2yrs have been the worst housing crisis in human history.

If there was a lender willing to put up the loan amount requested for the borrower on this one (which there is not) 8pts would be charity, not fees.

quote:

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Originally posted by Dharma

Thanks Kyle. I appreciate your input.

I am doing this for a friend(really a friend..not trying to steal his deal). He has it with a lender for 8 pts...( whithout his points) . I was just hoping he will get a better deal. If I can't find better he will most likely close it but it is way too expensive. Anyways,I will not spend much time on it. I will let him deal with who ever says they are interested in the deal.he can judge if it is worth his time. Thanks.

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Originally posted by KHufford

Well, that is a lot to charge, especially on the broker side. I doubt any real lender would even allow that much to be built into the loan, thats somewhat unheard of.

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