Non-Recourse Condominium Construction Financing...

The key elements that contribute to the direct success of each of these plans are:

	Condominium Plan Attributes.  The condominium plan should be sized to correspond to more funds than space - meaning if the condominium plan takes up 12% of the project space plan, then the expectation would be to provide 15% (or more) of the total capital funding structured.  Furthermore, because condominium sales (in most states) are strictly regulated, they prevent the developer from using these funds until the end of the construction period.  This means the capital funding will be available, more or less, in the last month of the construction phase and covers the last draw on the construction loan.
	Fractional Tenants-In-Common Syndication Plan Attributes.  The tenants-in-common plan has more built-in flexibility with syndication proceeds being made available to the development as early as the pre-construction phase.  This feature makes the tenants-in-common approach a "gottstohave" for every commercial real estate development financing.  The tenants-in-common plan is intended to provide an additional 20% to 30% of at-risk capital financing that can bring the total equity slice (from third-party investors) up to a range of 35% to 45% of the total development budget.
	Statutory Entitlements Financing.  Tax credits and tax-advantaged investment incentive entitlements that are available with the only requirement being the asset meets a placed-in-service date - and not awarding through an application and/or lottery process.  The most advantageous use of this element of the capital finance structure is to purchase credit enhancement for the benefit of the construction lender and/or a buy-down of the construction loan interest rate.

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