Spec House Program

Property Type:

Single Family Residential

Execution Type:



Charlotte, NC



Opportunity / Challenge

Residential builders have had trouble accessing financing for larger speculative developments. While builders may be able to find small banks that will do one transaction at a time, higher volume builders are unable to create programmatic relationships with lenders that allow easy and quick access to capital.

Red Fox Capital Solution

Red Fox Capital agreed to put a financing program in place for the builder. Loans are cross-collateralized and cross-defaulted. Having built high end speculative homes, Red Fox Capital is more familiar and comfortable with high end development than most of the small banks.

Exit Strategy

Homes are built and sold, and the Red Fox Capital line is paid down. Builder and Red Fox Capital meet quarterly to discuss number of specs to put in the market at one time, development time-lines and price points to target.

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