Ground-Up Development
Finance new apartment construction from the ground up with CMHC ACLP, covering 90% of construction costs with progress draws through completion.
- 90% loan-to-cost available
- Monthly progress draws
- Fixed-rate construction loans
Apartment Construction Financing
Finance ground-up multi-family development and major renovations with CMHC's Apartment Construction Lending Program (ACLP) and specialized construction-to-permanent financing. Access 90% loan-to-cost on apartment projects, with flexible draw schedules and seamless conversion to long-term mortgage insurance upon completion.
90% LTC Apartment Development Financing
Construction financing is critical for apartment development. Our CMHC ACLP programs and construction-to-permanent structures reduce your upfront equity requirement and manage cash flow through the development phase, with seamless transition to long-term financing upon project completion.
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High Leverage Construction
Achieve 90% loan-to-cost on apartment construction, minimizing your upfront equity and preserving capital for other projects.
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Progress Draw Schedules
Access funds tied to construction milestones—typically monthly as work completes, improving your cash management and budget control.
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Seamless Conversion
Convert from construction financing to permanent CMHC mortgage insurance without refinancing, with rates locked during the construction phase.
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Fixed-Rate Construction
Lock in rates during construction rather than facing floating-rate uncertainty. Your permanent rate is typically set at or near the construction loan rate.
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Builder & Developer Friendly
Structure designed to accommodate developer cash management, inspector holdbacks, and contingency reserves typical in multi-family projects.
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CMHC Takeout Certainty
Permanent financing is pre-approved through CMHC ACLP, reducing risk of financing gaps and enabling reliable project budgeting.
Ready to finance your apartment development?
Construction Financing Options
Specialized construction programs for ground-up development and major renovations.
Conversion & Major Renovation
Finance major renovations, building conversions to rental, or significant upgrades with construction-to-permanent CMHC financing.
- Construction draws based on milestones
- Conversion to permanent CMHC insurance
- Extended amortization on completion
CMHC ACLP Program
CMHC's dedicated program for multi-family construction, offering the highest leverage available in Canada with streamlined underwriting for qualified projects.
- 90% loan-to-cost financing
- Dedicated CMHC underwriting
- Pre-approved permanent takeout
How Much Can You Finance on Multifamily?
Apartment Construction Financing Requirements
Construction financing requires detailed project documentation, experienced builders, and clear development plans. CMHC ACLP has specific requirements to ensure project success.
Requirements
- Detailed architectural drawings, engineering reports, and construction budget.
- Experienced contractor/builder with multi-family development track record.
- Developer or sponsor equity injection (minimum 10% of construction costs).
- Detailed pro forma financial projections for permanent take-out phase.
- Site control or ownership and zoning/municipal approvals.
- Professional project manager and construction loan inspector assignment.
How We Help
- Expert project underwriting and construction-to-permanent structuring.
- Access to CMHC ACLP and specialized construction lenders across Canada.
- Rate lock during construction with permanent CMHC financing upon completion.
- Construction cash flow management strategies and draw timing optimization.
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Questions About Construction Financing Options
Everything you need to know about construction financing options.
Project Requirements & Planning
Minimum projects are typically $2M+ in construction costs. Smaller projects may be possible but often require alternative lenders at higher cost of capital.
Typical equity requirement is 10-15% of total construction costs. This ensures developer commitment to the project and helps secure the 90% LTC financing available through CMHC ACLP.
Construction loans can include contingency reserves (typically 5-10% of budget). If contingency is exhausted, you'll need additional capital, a budget revision, or approval from your lender for increased drawdowns.
Detailed architectural drawings, engineering reports, construction budget, contractor qualifications, site plans, zoning approvals, project pro forma, and detailed permanent financing assumptions.
Financing & Rates
Multi-family construction typically takes 24-36 months depending on project size, complexity, and construction schedule. Lender commitment usually covers construction period plus 6-month buffer.
Construction rates are typically 0.50-1.00% above prime, but the rate is often fixed. Your takeout (permanent) rate is usually set at or near your construction rate, providing rate certainty.
Upon substantial completion and occupancy, the construction loan converts to permanent CMHC mortgage insurance. The property stabilizes over 6-12 months, then you have a long-term fixed mortgage at your pre-locked rate.
Yes. Once the building achieves stabilized occupancy (typically 90%+), you can refinance the permanent mortgage to potentially access better rates or different terms with standard CMHC MLI Standard or MLI Select programs.
Construction Financing Basics
ACLP (Apartment Construction Lending Program) is CMHC's dedicated program for financing new apartment construction and major renovations. It offers up to 90% loan-to-cost with pre-approved permanent financing upon project completion.
Construction financing covers costs during building (typically 24-36 months) with progress draws. Takeout financing is the permanent mortgage that replaces construction financing once the building is complete and stabilized.
Construction Financing Basics (Continued)
As your project completes construction milestones (typically monthly), you submit requests with contractor invoices and inspector certifications. The lender funds the draw, usually holding back 10-15% until final completion.
Yes. Most construction-to-permanent programs allow you to lock in your takeout rate during or near the end of construction, protecting you from rising interest rates.