Seeking Lender for Subdivision Project – Equity-Rich, Build-to-Sell Multifamily

[James Boonstra]

Hello BiggerPockets community,

I am developing a 10.5-acre subdivision purchased for $250,000 (20% down). The property has been subdivided into 17 residential lots. This project is being carried out as a joint business venture between father and son, combining experience, resources, and long-term commitment.

Phase 1 – Completed & Sold

• Built two triplexes on Lots 1 and 17 (county road frontage).

• Construction Cost (per triplex): ~$360,000

• Sales Results: Sold rapidly at $525,000 and $515,000.

• Rental Performance: All 6 units rented at $1,475/month each and fully leased within 45 days prior to sale.

• Takeaway: Strong demand both as income-producing rentals and as retail sales, proving multiple exit strategies.

Phase 2 – Current Stage

• Infrastructure Requirement: A road with full utilities must be built to access the remaining 15 lots.

• Road & Utility Build Cost: ~$365,000 (includes cable internet, electric, and water).

• Appraised Value: With the road in place, lots are valued at $65,000 each = $975,000 land value.

• Equity Position: Over 40% equity remains once infrastructure is complete, creating a secure lender position.

Why the Bank Declined

The income from Phase 1 structures made financing an easy approval, but the non–income producing road expense, when combined with new construction, lowered the overall income-to-debt ratio below the bank’s threshold. The decline is based on underwriting metrics, not project fundamentals.

Strategy – Build-to-Sell with Retained Ownership

Our focus is Build-to-Sell multifamily homes (duplexes and triplexes). However, we also plan to retain a portion of the homes for long-term rental income, leveraging our existing portfolio of multiple rentals and a high-performing Airbnb.

This dual approach provides:

• Short-Term Profitability through proven duplex/triplex sales.

• Long-Term Stability through selective rental holdings.

What We’re Looking For

We are seeking a lending partner to finance the road and utility infrastructure ($365,000). Once completed, we will continue building additional duplexes and triplexes, balancing speculative sales with strategic ownership.

Ideal Partner

• Comfortable lending against high-equity positions

• Experienced in land development, subdivision, or infrastructure lending

• If this opportunity aligns with your lending focus, we’d be glad to connect and provide detailed budgets, pro forma, and timelines.

  Thank you for your time and consideration!

  James M Boonstra