$1.1M Construction Financing via Private Mortgage Powers Duplex Development in Delta

Client: Group of Three Builders, Delta 

Property Value: $1,170,000 CAD (Lot Purchase) 

Loan Amount: $1,100,000 CAD (Institutional Private Mortgage)

A group of three experienced builders identified a premium duplex lot in Delta, BC, valued at $1,170,000. Their goal: to develop two high-end residential units with an expected sale price of $1.3 million each—representing a combined project value of $2.6 million.

However, they required fast real estate funding to close the land purchase.

We structured an institutional private mortgage for $1.1 million at 11.95% interest with a 1.5% lender fee. This tailored construction financing solution reduced their out-of-pocket cost to just $70,000, preserving essential liquidity for the development phase.

To further streamline the financing, the loan was secured using one builder’s principal residence—freeing up project cash and preventing unnecessary equity dilution.

Loan Structure & Development Timeline

• Loan Type: Institutional private mortgage

• Term: 1-year open with interest-only payments

• Purpose: Secure land and bridge to future construction mortgage

• Security: Principal residence of one partner

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This gave the clients time to finalize zoning, secure building permits, and lock in their construction budget.

Exit Strategy

Once permits are secured, we will transition the loan into a construction mortgage with the same lender—simplifying the refinance process and minimizing additional fees.

Results

• Minimal Cash Needed: Only $70K required upfront

• Liquidity Preserved: Capital reserved for actual construction

• Clear Timeline: Construction to begin upon permit approval

• Planned Profitability: Projected sales of $2.6M (2 x $1.3M)

  
  

This case demonstrates how construction financing through private financing can be structured strategically to unlock value on high-potential real estate developments—especially when traditional lenders hesitate to move quickly.

Need help structuring a project like this? We’ll help you turn real estate opportunities into built value—fast.