Loan Closing

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​A deal isn't a deal until you close on your bank loan.  There will probably be other members on the development team (besides the development manager) that will source the bank financing and lead the loan closing process.  However, the development manager may lead the closing process, or will at least have a significant roll in providing documents required for closing.

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Your bank will provide the borrower/developer a loan closing checklist with all the project and borrower information and documents they will need before closing on the loan. 

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Your bank will likely hire a lawyer to oversee and manage the loan closing process for them.  If this happens, the borrower/developer will also usually hire a lawyer to represent them for the closing.  Loan closing can get held up for unimportant, fine detail items.  Every "i" has to be dotted and every "t" crossed.  It is usually less of a headache for the developer and faster if the two lawyers can directly work out any fine details that get everyone closer to closing.  The only problem is that lawyers are expensive.  It's not uncommon to pay $15k - $20k in legal fees for your lawyer, and $20k - $25k for the bank's lawyer.  Yes, that's right, the developer has to pay for the bank's lawyer for the loan closing process.  These bank legal fees should be incorporated into your legal line item in your development budget. 

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Typical items that the development manager has to provide for the loan closing checklist are: 

• ALTA Survey

• Site Plan

• Plat

• Org Chart of Borrower and Developer Entity

• Architect Contract

• Engineer Contracts (civil, MEP, structural)

• Construction Contract

• GC's Insurance

• Payment & Performance Bond

• Permit

• Plans

• Phase I Environmental Site Assessment

• Geotech Report

• Evidence of Proper Zoning

• Utility Will-Serve Letters

• Development Budget

• Land Purchase Agreement or Deed

• Leases Signed by Future Tenant(s)

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