Commercial Construction Loan and Financing Options
Numerous Options Available For Financing Commercial Construction
The construction industry is facing an upturn that many say is long overdue. With an increase in the demand for commercial buildings, there is a corresponding increase in the number of companies that require construction financing. Thankfully, there are many options available in construction funding, whether you are a startup or a more established firm.
How a construction company benefits from construction funding
Any commercial construction will involve significant costs and require substantial financial resources. Not all builders have the financial means to handle such projects, which is where construction financing comes in. Certain companies offer financial assistance to builders and developers in order to help them build a business from the ground up or expand on an existing one.
These companies are absolutely essential to the success of any construction project, and they can affect how quickly a business can get up and running and start to turn a profit. Funds provided by these companies can be used for purchasing real estate, machinery and equipment, or simply to cover the costs of construction.
Getting a loan for a commercial construction project
The process of obtaining construction financing first involves determining how much of the costs you are prepared to handle on your own. In recent years, it has become standard practice for building owners/developers to put up 45% of the project cost and even more. If necessary, additional investors may also have to be brought in order to raise more money for the rest of the project.
In most cases, you will still need to apply for a commercial construction loan from a local bank. Keep in mind that financial establishments tend to monitor commercial construction projects closely, and progress will likely be monitored by loan officers from time to time. In general, local banks are often more supportive of local construction projects than those planned for out of town.
It is important to determine early on what type of loan you actually require for your project. It might be a good idea to check out your loan options from commercial banks early on. These establishments are far more likely to provide construction financing than other types of banks. It is generally standard practice to loan an amount that is appropriate to the size of the bank. Most small to medium-sized banks should be able to handle financing commercial construction jobs at about $1 million to $2 million.
Getting professional help for construction financing
At some point, you may find it beneficial to get outside help for securing a loan for your construction project. Many companies are in the business of providing startup developers the financial ability to construction the buildings that they need. One such company is Hammers Construction, and it has long years of experience helping developers finance construction projects for various applications.
If you are looking for a way to finance your next commercial construction project, give Hammers Construction a call at 719-570-1599. Our team of construction professionals will help you build the structure that you want at a price that you can afford.