Rescue capital prices off what is unfinished — that is why it costs 15% and a piece of your promote. But one layer of a half-built project is already complete: the land. Sold at its as-complete value and leased back, it produces the capital that rebalances the loan, funds the finish, or ends the proceeding — and the promote stays yours.
| Situation | The land move |
|---|---|
| Construction loan out of balance | The lender wants more equity before funding resumes. Land proceeds go in as that equity — cash the lender can see — without a rescue partner taking the promote. |
| Lender exited mid-project | A year of hunting usually means the replacement ask is too big. Land money first, then a smaller completion loan — smaller loans get done. |
| Cost overrun ate the contingency | The overrun is funded from the land layer at a fixed, non-amortizing cost instead of 15%+ rescue paper. See the overrun page. |
| Receiver or foreclosure looming | Land proceeds plus a right-sized completion facility can reach the payoff or rebalance number that ends the proceeding — while the sponsor still controls the outcome. |
The two honest gates: a credible budget-to-complete, and named comps for the finished product. We size off the as-complete income, so the plan to get there has to hold up. If it does, the land is the cheapest rescue capital in the market; if it does not, no capital structure fixes the project.
Three, usually: write the check yourself, take rescue preferred equity at 15%+ with control rights and a piece of the promote, or monetize the land. A ground lease converts the finished layer of the project into the equity the lender wants, at a fixed, non-amortizing cost, with no partner and no dilution.
Yes — the land is priced off the finished project's stabilized income, not the construction site's current state. What we underwrite is the credibility of the completion plan: real budget-to-complete, real comps for the finished product.
An indicative number comes fast from three inputs: the site, the budget-to-complete, and the stabilized pro forma. Stalled projects usually have all three sitting in the lender package already.
The window narrows but often stays open: land proceeds plus a completion facility can reach the payoff or settlement number while the sponsor still has standing. The earlier in the proceeding, the more of the upside survives.
The land, on a 99-year lease: nothing to manage, senior to the building’s lender, low yield because the buyer is buying the right to not pay the tax. The building above it: higher yield, paid monthly, depreciable. Both are replacement property. Both close on a date we control, which is the part that matters on day 140.
1031 SolutionsWorking with an intermediary? The standby sheet for line 3 of the identification form.
Send the site, the budget-to-complete, and the stabilized pro forma — the same package your lender already has. An indicative land number comes back fast.