Cost of land towards a construction loan

[David Greenberg]

I am trying to figure out how much equity I would need to raise to build a hotel. Here are some assumptions:

- Let's say I were to a build a hotel and the total cost were $10 million

- The value of the land on which the hotel is being build is $2 million. There are no liens on the property.

Would I be able to count the $2 million towards equity? For example, if I did no include the property value and was looking to achieve a 60/40 loan to value, I would need to raise $4 million. Could I reduce my cash raise to $2 million if I include the property value?

I look forward to any responses.