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For mid‑market sponsors, capital is still available, but the bar is higher. Lenders and private credit are laser‑focused on five areas: absorption, pre‑leasing, cost overrun protection, equity (25–35%), and sponsor strength, with Canada adding a decisive sixth: CMHC program eligibility.

The paradox of 2025 is that hotel financing is both more competitive and more available than in recent years. But this availability is conditional. Projects that demonstrate strong fundamentals, disciplined budgeting, thoughtful operator selection and comprehensive feasibility analysis are attracting more interest than ever.

The construction loan market in 2025 presents real challenges, but opportunities exist for well-prepared sponsors. Those who understand current rate drivers, implement strategic lender selection approaches, and maintain financing flexibility will secure the capital needed for successful projects. Sub-7% construction loan rates require careful planning and strong credentials, but they’re absolutely achievable for qualified borrowers using sophisticated financing strategies.

Real estate evaluation is more than just inspecting a building or reviewing a contract. It’s a comprehensive process that covers legal, financial, physical, and market aspects of a property.

Hotel developers have discovered that C-PACE financing offers several compelling advantages over traditional financing mechanisms. The most significant benefit lies in its ability to reduce overall development costs while improving project returns.

Construction financing serves as the lifeline for developing new projects, providing the necessary capital to bridge the gap between groundbreaking and the realization of revenue through sales or leasing. However, within the context of Canada's current housing shortage, securing these funds has become a formidable challenge, compounded by rising interest rates and stringent lending criteria.

6 tips on how to get financing for your construction project, help you navigate the process, and secure the funding you need.