Private Construction Completion Loan for Spec Home in Malibu, California

SDC Capital, a direct private lender based in Burbank, funded a $1,000,000 (50% As-Is LTV) 1st lien position loan to complete the construction of a 5,000-square-foot single-family residence in Malibu, California. The Borrower, a real estate developer, purchased the land in 2018 with cash and was already well into framing when the deal landed on our desk. We were confronted with the usual mid-construction obstacle of obtaining mechanic’s lien coverage. Fortunately, we’ve had more and more success in obtaining this coverage recently, so we were able to put this deal together quickly. Of the $1,000,000 provided, $500,000 was advanced at closing while the remainder was held in fund control. This allowed the Borrower to keep moving forward with construction and gave us added protection in case the project stalled out. This loan was funded in November 2018.