Saving a Development Project

A seasoned developer with over 20 years of experience faced a critical deadline: a $700,000 seller note had matured on July 1st, threatening to derail an important community redevelopment project in Jersey City. The property—a former rectory and Catholic school—was set to become 13 residential multifamily units as part of the larger Sacred Heart Redevelopment initiative.

The project had strong community support and clear municipal backing, but the developer needed immediate capital to complete site plan approvals and secure construction financing. With the seller note already matured, time was running out on a project that would benefit the entire neighborhood.

• Complex redevelopment scope: Banks couldn't efficiently underwrite the conversion of religious institutional property
• Predevelopment timing: Committee-driven processes couldn't meet the matured note deadline
• Mixed collateral structure: Conventional lenders required standardized collateral packages
• Construction bridge gap: Traditional lenders wanted to see permits in place before funding

While banks saw complications in the religious property conversion and community development aspects, we saw an experienced developer with a clear vision and strong local support.

What made this deal special was the strong public backing. As part of the Sacred Heart Redevelopment initiative, the project benefited from:

• Municipal support for the larger community development vision
• Church partnership in the overall redevelopment plan
• Neighborhood backing for the residential conversion
• Clear regulatory pathway due to community involvement

The developer's team included a certified architect and city planner with over 20 years of development experience, providing the technical expertise needed to navigate the conversion process efficiently.

Rather than viewing this as a complex development loan, we structured it as a bridge solution with clear milestones:

• Conservative leverage at 36% combined loan-to-value for maximum flexibility
• Built-in takeout strategy with construction financing commitment already secured for $4.3M
• Performance milestones requiring site plan approval within 135 days
• Risk mitigation through diversified collateral across multiple properties

In six months, this developer will transition from a stalled project with matured debt to a fully-entitled development ready for construction financing. The community will see the transformation of an important neighborhood landmark, and the developer will have preserved a valuable opportunity that traditional lenders couldn't support.

This transaction demonstrates how Spectra Lending approaches special situations where community impact meets financial opportunity. When projects have both strong fundamentals and public support, we're structured to provide the creative capital solutions needed to move forward.