Vacant Land Loans in Los Angeles, CA

Raw land financing enables investors to acquire unimproved parcels for future development, speculative appreciation, or entitlement processing. These properties have no infrastructure, permits, or approvals, representing pure development potential based on current zoning and market conditions. Our raw land loans typically offer lower leverage than improved property financing, usually 40-50% loan-to-value, reflecting the higher risk and longer anticipated hold periods. These loans are structured with interest-only payments and terms from 1-3 years, recognizing that raw land generates no income to service debt. Common strategies include acquiring land in path-of-growth areas before infrastructure expansion, purchasing sites for future entitlement efforts, and land banking in anticipation of regulatory changes or market appreciation. Los Angeles raw land opportunities range from small urban infill lots to large hillside parcels, each requiring specific due diligence around topography, access, utilities, and environmental conditions.

Development sites are entitled properties with zoning approvals, environmental clearances, and permits in place for specific construction projects. These sites command premium values compared to raw land but offer reduced risk and faster monetization timelines. Our development site financing serves builders and investors acquiring ready-to-build properties, providing capital to close on sites before construction financing is arranged. These loans can be structured with short terms (6-18 months) if construction financing is imminent, or longer terms if the business plan involves holding the entitled site for market timing or partner coordination. We evaluate development sites based on the approved project economics, remaining conditions to construction, and the developer's track record. Common scenarios include acquiring sites with tentative tract maps approved, purchasing entitled apartment or commercial development sites, and taking down land positions as part of joint venture structures with institutional capital partners.

The entitlement process in Los Angeles, securing zoning approvals, environmental clearances, and permits for development, can take 1-3 years and requires significant capital investment before any income is generated. Our entitlement bridge loans provide acquisition and carrying cost financing for land investors navigating this process. These loans cover land purchase, property taxes, entitlement consultant fees, and interest reserves that service debt during the lengthy approval process. We structure entitlement loans with extended terms (2-4 years) and flexible extension options recognizing that entitlement timelines often exceed initial projections due to community input requirements, environmental review processes, and regulatory negotiations. Loan amounts are based on the entitled value of the land rather than raw land value, providing higher leverage as entitlements progress. Exit strategies typically involve either selling the entitled site to a developer or transitioning to construction financing once permits are issued.

Despite its urban reputation, Los Angeles County contains significant agricultural acreage, particularly in the northern valleys, Antelope Valley, and peripheral areas. Agricultural land financing serves farmers, agricultural investors, and rural property owners seeking capital for land acquisition, refinancing, or operational needs. These properties may include active farms, orchards, vineyards, equestrian facilities, or idle agricultural land held for future development potential under Williamson Act contracts or other preservation programs. Our agricultural land loans evaluate properties based on agricultural income potential, soil quality, water rights, and development optionality. Loan structures accommodate the seasonal cash flows of agricultural operations and the longer-term appreciation potential of land in transition areas. Common scenarios include acquiring agricultural land for farming operations, refinancing existing agricultural debt, purchasing land with development potential after preservation contracts expire, and financing recreational rural properties with agricultural components.

Land loan LTV ratios are typically lower than improved property financing due to the absence of income and higher risk profile. For raw land without entitlements, we generally offer 40-50% loan-to-value based on current as-is value. For entitled land with approved projects, LTV can increase to 50-60% reflecting the reduced risk and higher value. Developed pad sites with infrastructure in place may qualify for up to 65% LTV. The specific leverage depends on location, zoning, entitlement status, and your development experience. We also consider cross-collateralization with other assets to enhance loan terms.

Yes, entitlement financing is one of our specialties. We provide loans that cover land acquisition plus carrying costs during the entitlement process, which in Los Angeles typically takes 1-3 years. These loans include interest reserves that service debt while you secure necessary approvals. We structure extended terms (2-4 years) with extension options recognizing that entitlement timelines often exceed initial projections. Our underwriting evaluates the feasibility of securing approvals based on zoning, general plan consistency, and environmental factors specific to the site.

Land value is determined by multiple factors including location, zoning, size, topography, access, utility availability, and entitlement status. For loan purposes, we typically rely on land appraisals that analyze comparable land sales, development potential, and highest and best use analysis. Raw land is valued based on its current as-is condition, while entitled land can be valued based on the approved development value minus estimated construction costs and developer profit. Environmental conditions, including contamination or protected species habitat, significantly impact land value and must be addressed in due diligence.

Land loan terms vary based on the investment strategy and development timeline. Raw land loans typically have 1-3 year terms reflecting longer hold periods for appreciation or entitlement processing. Entitled land loans may have 6-18 month terms if construction financing is imminent, or longer if holding for market timing. Entitlement bridge loans often have 2-4 year terms to accommodate lengthy approval processes. All our land loans can include extension options if timelines extend due to market conditions or regulatory delays, typically at predetermined extension fees and rate adjustments.

Common land loan exit strategies include: selling the land to another investor or developer at a profit, particularly after securing entitlements that increase value; transitioning to construction financing once development permits are issued; selling the land as part of a joint venture structure with a homebuilder or commercial developer; refinancing with longer-term debt after value appreciation or entitlement completion; and ground leasing the land to generate income while retaining ownership. We work with borrowers to develop realistic exit strategies before funding and structure loan terms that accommodate the anticipated timeline.