This site development loan was made for purposes of financing the surcharge & wicking required to prepare the subject property for a twin-branded, 185-unit, 5-story hotel project. Located very near San Francisco Bay, the bay mud soils required extensive compaction or densification to handle the weight of the proposed structure. The sponsors, working closely with their consultants and development team, determined surcharge & wicking to be the best approach and solution. The construction budget also included relocating an existing sewer line, raising the site elevation out of the flood plain, and providing funds to advance the project to building permits.
Seattle Funding Group makes comparatively few land or site development loans, but this one had many compelling elements, which ultimately made it a good fit within our lending models. Strong sponsorship, a free and clear, well-located 3.45-acre site, design approval, sewer relocation and grading permits in hand, a solid, highly-experienced site improvement team, and a low LTC and LTV.
What it took was underwriting the construction risk and loss of priority, coupled with extensive reading and analyses, as it was SFG’s first construction loan primarily focused on the surcharge and wicking process, a process well-established and proven around the Bay Area given the soils conditions often presented. SFG’s Team and Management were up to the task, and with the cooperation of the sponsors and their capable site development team, we stepped outside our comfort zone to accommodate this solid sponsor and their terrific construction loan request.
SFG…providing the flexibility of a direct, portfolio lender with Capital at the Speed of Business.
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