SOLUTIONS
Large condo construction projects do not get funded the same way as standard repairs. Contractors invoice in stages, work is completed over months, and the board needs a financing structure that matches the project timeline.
Condominium Lending Group provides condo construction financing for major building projects where funds need to advance in draws as work is completed. The loan is made to the condo corporation, not to individual unit owners. Owners do not provide personal guarantees, personal credit checks, or security against their units.
For illustration, a 100-unit building facing a $2,000,000 construction project may be looking at a $20,000 per-unit special assessment if the full amount is collected upfront. With corporation-level construction financing, funds can be advanced in stages and repaid over time. The exact repayment amount depends on the loan size, draw schedule, rate, term, project timing, and approval structure.
Financing Arranged
Condo Corporations Served
Provinces & Territories Served
Initial Response Time
THE PROBLEM
A standard term loan usually advances the full amount at once. That does not always fit a condo construction project.
Large projects move in phases. Contractors invoice as work is completed. Engineers or project managers may need to certify progress. Timelines can shift because of weather, access issues, materials, inspections, or site conditions. If the financing does not match that timeline, the corporation can end up paying interest on funds it has not used yet.
This matters for projects like building envelope replacement, underground parking restoration, structural repairs, cladding work, deficiency repairs, and other large construction projects. These files often run into the millions of dollars and can exceed what the reserve fund can cover.
The board also has governance work to manage. Owners need to understand the project, the repayment impact, and the reason financing is being considered before any approval process moves forward.
THE FINANCING OPTION
Condominium Lending Group structures construction loans around the actual project schedule. Funds are advanced in draws as work is completed and certified, instead of being advanced all at once upfront.
That means the corporation draws what it needs at each stage. During the construction period, interest is charged only on amounts advanced. Once the project is complete, the loan can convert to a fixed repayment structure collected through monthly common expense contributions or strata fees.
This type of construction draw financing can help boards manage large projects without collecting the full cost from owners upfront. It also gives the board a clearer way to explain how the project will be funded, when funds will be advanced, and how repayment will work after completion.
For some projects, capital repair financing may be enough. For larger staged projects, a condominium construction loan may be the better fit. We will tell the board early which structure makes more sense for the file.
DRAW SCHEDULES
Construction draw financing is built around progress. The corporation does not receive the full loan amount on day one unless the project requires it. Instead, funds are advanced as work is completed.
A typical draw process may include a contractor invoice, engineer or project manager review, certification that the work has been completed, and then an advance from the lender. The exact process depends on the project size, complexity, and documentation available.
This protects the corporation from borrowing too much too early. It also gives the board a cleaner paper trail when owners ask how funds are being released during the project.
For boards, the main benefit is control. The financing follows the work instead of forcing the work to fit a standard loan structure.
PROJECT TYPES
Some major building projects are too large or too phased for a simple upfront loan. These are the types of construction files where staged draws can make sense.
Parking garage and underground structure projects can involve concrete repair, waterproofing, drainage, traffic coating, and structural review. These files often need staged funding because work is completed section by section.
Building envelope replacement can involve cladding, waterproofing, windows, balconies, exterior walls, and related engineering work. These projects often move in phases and may need certified advances as work is completed.
Structural repairs can require engineering oversight, phased contractor work, and documentation before each payment stage. A draw schedule helps match funding to completed work.
Developer deficiency repairs can create immediate funding pressure while litigation or warranty recovery is still unresolved. Construction financing can help the corporation complete the work while recovery efforts continue.
Some buildings face several major projects at the same time, such as envelope work, mechanical upgrades, parking repairs, and structural remediation. Staged construction financing can help organize funding around the full project timeline.
HOW IT WORKS
Most corporations receive an initial response within one business day. The full timeline depends on the project, the construction schedule, the documents available, and the approval process required in your province.
Send us a short summary of the building, the construction project, the expected cost, and the timeline the board is working with. You do not need final contractor pricing to start the conversation.
We review the reserve fund study or depreciation report, financial statements, project scope, contractor estimates if available, engineering reports, and expected draw schedule. From there, we give the board a preliminary view of what construction financing may look like.
Once the financing structure is confirmed, the board can present the repayment terms, draw schedule, estimated owner impact, and approval requirements to owners. We provide clear financing summaries so the board is not trying to explain the numbers from scratch.
After the required approvals are complete, funds are advanced to the corporation according to the agreed draw schedule. Advances may be tied to completed work, certification, invoices, or other project documentation. Once the project is complete, repayment continues through monthly common expense contributions or strata fees.
WHO WE WORK WITH
We work with registered corporations where the construction need belongs to the building, not to individual owners arranging personal financing.
Registered condo corporations managing major construction projects where the reserve fund cannot cover the full cost or the project needs staged funding.
Strata corporations with major common property projects where the contingency reserve fund is not large enough to cover the work identified in the depreciation report.
Mixed-use corporations with residential, retail, office, parking, or commercial components may still qualify. These files can be more complicated, but the basic question is the same: can the corporation support repayment and approve the financing properly?
Corporations dealing with construction deficiencies, warranty issues, litigation, or recovery claims where the work needs to be completed before funds are recovered.
Corporations managing projects where contractor payments happen in stages and the board needs financing that follows the construction schedule.
A condominium construction loan is financing made to the condo corporation for a major building project where funds may need to advance in stages. The corporation is the borrower, not individual unit owners.
This structure is often used when the project has contractor milestones, engineering certification, phased work, or a draw schedule.
A construction loan advances funds in draws as work is completed rather than all at once upfront. During construction, interest is usually charged only on amounts drawn.
A term loan advances the full amount at once and repayment begins right away. Term loans can work for simpler projects. Construction loans are usually better for larger projects that take months to complete and involve phased contractor payments.
Construction draw financing means funds are advanced in stages as the project progresses. A draw may be tied to a contractor invoice, engineer certification, project manager approval, or another agreed milestone.
This helps the corporation avoid borrowing the full amount before the work requires it.
For larger or more complex projects, yes, an engineer or qualified professional may be required to certify that work has been completed before each draw is advanced.
This protects the corporation and the lender by confirming that funds are being released for completed work. For smaller projects, different documentation may be acceptable.
Condo construction financing can be used for major building projects such as building envelope replacement, underground parking restoration, structural repairs, cladding replacement, major deficiency repairs, and large phased common element projects.
If the project requires staged contractor payments, it may be a fit for construction financing.
After construction is complete, the loan can convert to a fixed repayment structure. The available term depends on the project, the corporation’s financial position, the repayment plan, and the expected useful life of the work being financed.
Specific term and amortization options are reviewed with the board before the loan is finalized.
If the corporation is financing deficiency repairs while pursuing litigation, warranty recovery, or another claim, recovered funds may be used to pay down the loan. This can be cleaner than collecting a special assessment first and trying to deal with recovery later.
The board should review this with legal counsel and the financing team before deciding on the final structure.
Sometimes. Construction financing may replace a special assessment, reduce the amount owners need to pay upfront, or give owners a longer repayment timeline.
The right structure depends on the project cost, available reserve funds, approval requirements, and the corporation’s repayment capacity.
Contact us as early as possible. Boards are in a stronger position when they understand financing capacity before finalizing project scope, contractor selection, or owner communication.
Early engagement gives the board time to compare funding options, understand the monthly repayment impact, and explain the financing structure clearly before owners are asked to approve anything.
TALK TO A SPECIALIST
Tell us what project your building is planning, what the estimated cost may be, and how the contractor schedule is expected to work. We will review the situation and explain what condo construction financing could look like before your board commits to final owner communication or project timing.
