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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.

If 2024 was a year of adjustment and 2025 is a year of selective growth, 2026 is shaping up to be a sorting mechanism: the projects and platforms that are genuinely aligned with the new rules of the game will scale rapidly; the rest will struggle for attention.

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.

The project finance ecosystem is experiencing what can only be described as a convergence of disruptive forces. Unlike previous market cycles driven by single factors—such as the 2008 financial crisis or the early pandemic disruptions—today's challenges stem from multiple, interconnected pressures that are fundamentally altering project economics and financing availability.

Canada ranks a dismal 16th globally in capital availability to small and medium enterprises. Luckily, Canadian alternative financing has emerged as a critical lifeline, with the market valued at $2.2 billion in 2024 and projected to reach $4.2 billion by 2028, representing a compound annual growth rate of 17.9%. This explosive growth reflects both the acute need for capital and the innovation occurring within the sector.

Most developed economies are edging toward circular-economy targets that require steep landfill-diversion rates, stringent methane-reduction pledges, and a steady ramp-up of renewable-energy portfolios. WtE technology sits squarely at the intersection of these imperatives.