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HUD Feasibility
Studies & Non-Recourse Financing Program
Alternatives...
Rainmaker
specializes in commercial real estate development project feasibility
studies, including HUD feasibility
studies. HUD's MAP program
focuses on providing non-recourse financing for developers of
multifamily housing and senior
housing. HUD's program includes
both market rate and low-income housing financing programs. The
drawbacks of the HUD-insured mortgage financing program are:
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Limitations
on certain fees the developer may receive - principally, the
development management fee is not part of the eligible basis unless
the project has a not-for-profit sponsor. This increases the
equity requirement if the developer requires the development fee
income. Rainmaker Marketing Corporation also supports an alternative
capital finance structure (the commercial real
estate syndication) that can close in as little as 21 days
from the time we have the necessary due diligence in hand and while
the project is still in its pre-construction phase; and
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Limitations
on certain offsite construction costs. If you have significant
offsite utility construction or significant pre-fabricated
construction, HUD will not allow these items to be part of the loan
basis. This also increases the equity requirement as the
offsite construction costs and pre-fabricated costs cannot be
avoided in certain circumstances. Talk to a Rainmaker
Marketing Corporation consultant about alternatives to equity
financing that provide non-recourse financing without an equity
dilution hit and how to do your very own classic "bootstrap
rollout" that increases financial investment leverage and
reduces market risk exposure; and
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Limitations
on product type. Some areas of the country will not pass
muster with HUD as HUD will claim the market has reached saturation
(whether it has or not). This can result in extended
application windows and/or loss of market opportunity. Talk to
a Rainmaker marketing Corporation consultant about alternatives that
come with all those HUD strings attached. If you thought the
FHA/HUD route was the only way to obtain non-recourse financing
without a big equity dilution hit - never mind those deal-killing
carrying costs the HUD process makes you absorb, you don't have to
settle for the lender of last resort; and
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on carrying costs. The uses of working capital in all
HUD-insured loans is the responsibility of the borrower - even when
these working capital requirements become excessive due to HUD's
patent inability to get applications processed in a timely manner
(i.e.: quite often, application windows will require years to
close). You pay your money and take your chances. As
stated above, this is no longer a requirement for you to accept
- at least not while more readily marketable opportunities will
present themselves to you that offer terms as good as HUD or
provide terms that the HUD-insured loan application process
cannot hope to match.
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About Rainmaker...
Rainmaker Marketing Corporation is the
brainchild of Clint Lovell, a seasoned business finance consultant with
more than 20 years experience. Rainmaker is a B2B consulting firm that was incorporated in 1994 for the
purposes of providing market feasibility studies to businesses
seeking capital financing in the commercial and institutional
markets. Today, Rainmaker Marketing Corporation provides a
comprehensive array of due diligence documentation services for most
major industry groups. Rainmaker Marketing Corporation also
provides syndication management services for fractional commercial
real estate syndicates that can provide mezzanine gap funding for
income-producing commercial property developments as early as the
pre-construction phase. Rainmaker Marketing Corporation serves
clients throughout North America and the Caribbean Basin. Rainmaker
Marketing Corporation, Inc. 15519
Dawnbrook Drive, Houston, Texas 77068
© Copyright,
2009 Rainmaker Marketing Corporation, Inc. All rights
reserved. |
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A
Few Words on Change...
Clint
Lovell, the Managing Principal of Rainmaker, has written a book on the
subject of capitalism and the creation of a new economic society that
ends our reliance on taxation and retires all of our national
debt. The book is called The Fix and you can order an
advance copy now at www.the
fixbookstore.com. Order today and we'll pay your shipping,
saving you some real change. |
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What's
New...
Read
our latest whitepaper on capitalization strategies and commercial real
estate syndications that provide developers with a new arsenal of
capital finance weapons they can deploy in the middle of this
recession. Click here and download the whitepaper
free! |
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