Finding Financing for New Construction

[Robert M.]

I own a short-term vacation rental that is killing it better than anything I've seen (80-90% cash on cash).  I plan to use it as a prototype to build on the land next door, but I'm running into some financing roadblocks.  I'm nervous about tying up $50K by buying and holding the lot if I cannot build soon since it would mean delaying other strategic priorities.

I'm finding that most banks won't do individual construction loans for investors.  Commercial construction lenders are giving me a bit of a hassle (though I haven't totally ruled this out - still exploring) because I bought my first property six months ago and don't have a year of performance to show (though I have about $65K of gross bookings and $35K in net income in 7 months).  Private/HMLs are telling me that they are only interested in new construction if the projects are large and the borrower is really experienced with developing or new builds (I have a couple of flips, a STVR, and no new builds, but I plan to use a GC for this project anyway so it seems irrelevant).  I don't have a huge network of real estate investors yet, so private lending through that avenue is a limited option for me too.

I have to make a decision on the lot very soon (days, not weeks) and the fact that I'm hitting one roadblock after another on financing is concerning. With a decent LTV, I'd gladly pay well for the construction phase before refinancing, but haven't the way forward yet. I have stellar credit, a great W2 income, and a good DTI if a lender will consider the income on the rental above (most won't because I bought it as a second home).

Suggestions on how to approach financing and/or whether or not to pursue the lot?

Also, since new builds haven't hereto been my thing: What are the chances that a builder will let me sell/deed them the lot, build, and then I buy it back with a conventional mortgage (which I think may be the cleanest path forward if it would work)?