Development and construction loans for retirement housing

A First National construction loan, conventional or insured, provides funds to cover the cost of building or substantially rehabilitating a property with terms typically of three years or less.

Borrowers use our construction program to cover land development and building construction costs. Funds can be disbursed on each stage completed, according to a prearranged schedule or when certain milestones are met.

CMHC-insured and conventional construction financing is available for retirement residences as well as purpose-built multi-family properties, mixed-use properties, and student housing.

An exit strategy is one of the key considerations for funding. Conventional construction loans are repaid from the proceeds of standard financing or the sale of the asset. For CMHC construction loans, there is an automatic conversion option to term financing.

Other critical considerations include the borrower’s experience, net worth and liquidity, as well as the location and quality of the site and market feasibility (especially for CMHC financing).

Speak to one of our empowered advisors to assess options and determine the best course of action for finding and securing a smart-risk mortgage.

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Smart risk solutions in action for seniors

See how we’ve applied our financing products innovatively to help seniors borrowers achieve their goals with performance and value.

CMHC MLI Select refinance that achieved level 3 energy efficiency to payout existing conventional construction mortgage and equity takeout

$128.9 M
400 units
Montréal, QC

CMHC insured mortgage
10 years term, 50 years amortization
LTV: 72%

Refinance to provide equity take-out for future acquisitions on a mortgage-free retirement residence

$40.3 M
165 units
Kelowna, BC

CMHC insured mortgage
10 years term, 30 years amortization
LTV: 85%

CMHC Market refinance of a free and clear retirement residence to provide equity take-out for working capital

$47.4 M
169 units
Kelowna, BC

CMHC insured mortgage
10 years term, 30 years amortization
LTV: 85%

Refinance of a free and clear retirement residence to provide equity take-out for improvements and acquisitions

$44.1 M
158 units
Penticton, BC

CMHC insured mortgage
10 years term, 30 years amortization
LTV: 85%

Refinance of a construction mortgage for a 31-storey, 266-unit building with 4,751 sq. ft. of retail space

$113.4 M
266 units
London, ON

CMHC insured mortgage
5 years term, 50 years amortization
LTV: 92.91%

Construction mortgage to develop a 7-storey and 10-storey complex with 159 units

$57 M
159 units
Oakville, ON

CMHC insured mortgage
5 year term, 40 years amortization
LTV: 80%

CMHC Market refinance of an 8-storey, 157-unit building to repay the current debt and equity take-out

$31.8 M
157 units
Sainte-Jérôme, QC

CMHC insured mortgage
5 year term, 40 years amortization
LTV: 70%

Refinance through CMHC MLI Select that realized Level 1 energy efficiency and accessibility to pay out existing debt and equity takeout.

$51.5 M
197 units
London, Ontario

CMHC insured mortgage
5 years term, 40 years amortization
LTV: 85%

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Latest resources and insights

Original perspectives and personal viewpoints on developments and industry trends in commercial real estate.

Growth, Value and Risk

Bank of Canada brings its benchmark interest rate down 50 basis points to 3.25%

The Bank of Canada tied a bow on 2024 by cutting its policy interest rate once again today to 3.25%. This latest 50 basis point drop – coming on the heels of reductions in June, July, September and October – is welcome news.

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Expert insights

A distinctly Western Canadian view of the year in commercial real estate financing

Activity in 2024 was bifurcated. In the first half of the year, overall real estate investment activity was relatively muted as interest rates remained in restrictive territory.

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Borrower perspectives

Borrower Perspectives: Rob Piroli, President, Piroli Group

Founded in 1992 in Leamington, Ontario, Piroli Group started in general contracting (under the name of Piroli Construction) but has evolved into a multi-faceted development group.

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Capital Markets update

Market Commentary: A catch-up and overview of the markets

First National’s, Jason Ellis, provides an overview as well as an update of the markets including rates, Government announcements and changes to the Commercial mortgages. Read an overview here.

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View other seniors mortgage solutions

CMHC financing

As a CMHC-approved lender, we are experts in securing insured financing that offers lower interest rates and longer amortizations. An insured mortgage enables borrowers to manage cash flow more effectively and realize higher investment returns.

Standard financing

First National’s standard financing programs are favoured by borrowers who are acquiring a new property or refinancing an existing building. Loan terms typically range from three to five years, have a fixed interest rate, and are closed to prepayment for the term’s duration.

Short-term (bridge) financing

First National’s bridge loan terms typically range from three months to three years, include floating interest rates and allow some form of early prepayment. Borrowers choose this solution until standard financing is secured or while they contemplate a property sale, a change in ownership structure or buying time to complete an operational improvement.

Asset repositioning

First National enables owners to access a property’s equity for a short term, typically two years or less, to fund capital improvements or repairs without the need to raise capital from personal sources or less flexible, higher-cost alternatives.

Secondary financing

A First National second mortgage enables a borrower to access the equity in a property and use it to purchase another asset or renovate/repair a property in their existing portfolio.