Looking at purchasing existing zoned land for rehab and conversion. Need help with financing question
What are things I can do around creative financing?
The area current is in downtown area and has a decommissioned car wash (230k with closing). We want to buy the area(concrete and existing structure) and the adjacent land that we are looking at buying.
The car wash would be converted to gas station in a strip mall type thing with pizza, subway or some other form of restaurant and an adjacent lot will be primarily office/business mixed use.
The area is eligible for developmental loans upto 250k for project at 3%. Can I buy the car wash with loan and the other lot with another loan and use personal capital for rehab. What are some creative ways to do this to maximize
[{"id": "iqarc7v", "text": "You're basically asking whether you can put ZERO equity day 1 and then out your own money when you want to do the capex? I can't imagine any lender in their right mind doing that. Private lending could be an alternative but that's going to be crazy expensive and that's going to squeeze your profits unless you have an insane amount of juice in the deal.\n\nYou've got non cashflowing land against which no lender I can think of will lend unless you got skin in the game. \n\nYour alternative is go and raise equity from friends, family or network, and you take an outsized portion of the profit from the deal (eg 10-15% of post tax profit for only 1-5% of equity). Pitch them your idea, your business plan, walk them through the numbers, the due diligence, construction costs assumptions, your market research, permitting situation, etc.\n\nAlso - gas station? No EV charging station?\n\nDM the deal details if you'd like.", "replies": [{"id": "iqas2z2", "text": "Will definitely dm you", "replies": [], "depth": 2}], "depth": 1}, {"id": "iqddm3i", "text": "Bridge loans for land acquisition are currently like 50LTV, 11 - 13% IO, 2pts, 12-18 month term.", "replies": [], "depth": 1}]