Funding for 2 unit ADU project on RM1-1 San Diego city

[Sam K.]

Hi BP Community,

I have a RM1-1 zoned property in San Diego city. I know I'm allowed to construct to 2 ADU's on it. I want to do a ground up construction of 2 ADU's on top of each other. I have questions around financing.

I'm expecting a total hard and soft costs to be close 275K - 325K for this project. Trying to finance most of the cost. All will be permitted and all work will be done via licensed general contractor.

1. Given I have purchased the property 6 months ago, I do not expect HELOC and Cash-out Refinance to cover a significant amount
2. Renovation loan under Freddie and Fannie only allows construction of one ADU on the property and hence that is also not an option in my opinion.
3. So I need references of lenders in San Diego or California area who will provide construction to permanent loans for such a project.

Also open to other suggestions and options that I'm not thinking about. Thank you!

[Matt Devincenzo]

City of SD has actually gone well above State ADU guidance...any existing '2-unit' zoned property can get up to 7 total units....

1. 2 units per your zone allowance
2. 1 attached ADU
3. 2 detached ADUs
4. 1 'bonus' ADU with the inclusion of 1 'affordable' ADU

The City code also clarifies that you do not have to build your remaining density before constructing the ADUs...and if your are in a Transit Priority area you can propose as many bonus/affordable ADUs pairs as you want. Obviously there are still design guides that might make this practically infeasible, but it is allowable.