Completion Guaranties in Construction Lending: Key Provisions for Lenders and Guarantors

A live 90-minute premium CLE video webinar with interactive Q&A


Wednesday, November 10, 2021

1:00pm-2:30pm EST, 10:00am-11:30am PST

(Alert: Event date has changed from 9/28/2021!)

or call 1-800-926-7926

This CLE course will examine key provisions found in a construction completion guaranty and selected points that are subject to negotiation.

Description

A principal concern for the construction lender is that the borrower will fail to complete the project on budget, leaving the lender to oversee the construction and to fund cost overruns. Under a completion guaranty, the sponsor or other qualified third party agrees to complete the project and is responsible for the payment of cost overruns. Construction lenders will typically include a carry component to the completion guaranty, and/or a separate carry guaranty, which requires the guarantor to pay debt service and other carry costs until the project is completed or reaches stabilization or until the loan is repaid.

Listen as our authoritative panel examines various aspects of completion guaranties and provisions that are high priority concerns for lenders and guarantors. The panel will also discuss provisions that can limit a guarantor's obligations under the guaranty and factors that might affect the ability of counsel to negotiate those provisions.

READ MORE

Outline

  1. Purpose of completion guaranties
    1. Defining guarantor's construction obligations
    2. Damages for failure to complete
  2. Factors impacting the scope of guaranty
  3. Loan funding and other conditions to completion obligation
  4. Limitations on liability
    1. Liquidated damages
    2. Limitation of costs: hard costs vs. costs to carry the loan
    3. Termination upon foreclosure or bankruptcy sale

Benefits

The panel will review these and other key issues:

  • The extent of the guarantor's exposure to fund construction costs
  • The guarantor's ability to access unfunded construction loan proceeds and reserves held by the lender
  • The construction lender's remedies, including liquidated damages provisions

Faculty

Anglin, Michael
Michael S. Anglin

Special Counsel
Cadwalader Wickersham & Taft

Mr. Anglin focuses his practice on real estate transactions. He represents financial institutions, opportunity funds,...  |  Read More

Brozynski, Christine
Christine Brozynski

Senior Associate
Norton Rose Fulbright

Ms. Brozynski’s practice focuses on the financing and development of energy projects, including with...  |  Read More

Attend on November 10

Cannot Attend November 10?

You may pre-order a recording to listen at your convenience. Recordings are available 48 hours after the webinar. Strafford will process CLE credit for one person on each recording. All formats include course handouts.

To find out which recorded format will provide the best CLE option, select your state:

CLE On-Demand Video

Download