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ARTICLE · 31 OCTOBER 2017

The Realist - Volume 1, Edition 4

Seyfarth Shaw LLP
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A publication of Seyfarth Shaw's New York Real Estate Practice. The ReaList newsletter covers New York real estate news, events, and trends.

United StatesReal Estate and Construction
Thomas Gleason
Thomas Gleason
Stephanie Grimaldi
Stephanie Grimaldi
Mitchell Kaplan
Mitchell Kaplan
Kristina Launey
Kristina Launey
Edward Maluf
Edward Maluf
Nicholas Soilleux
Nicholas Soilleux
Minh Vu
Minh Vu
Owen Wolfe
Owen Wolfe
Jonathan Wolfert
Jonathan Wolfert
+1 more
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A publication of Seyfarth Shaw's New York Real Estate Practice. The ReaList newsletter covers New York real estate news, events, and trends.

Real Estate:

Construction Loan Guarantees

Commercial mortgage loans secured by existing income producing properties are often made on a non-recourse basis to the borrower (and its principals).  These loans generally have the benefit of real property collateral producing sufficient cash flow to service the lender's debt and cover operating expenses for the property.  Construction loans, however, present a different risk profile for the mortgage lender due to, among other things, no cash flow being generated from the property during the course of construction, the possibility of the project not being completed within budget (or at all) and the increased risk of liens for labor and materials being filed against the property.  In addition, even after construction is completed there is often a period of time prior to

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