3.10.4 Extended Lease-Up Period

A . A Large loan is often associated with large property size measured in number of units, which may indicate a lengthy lease-up or absorption period. The absorption period for estimating market demand is up to a maximum of 18 months. HUD Regional Office Directors may waive the 18-month absorption period restriction only in cases where there is an unusually strong market that will support initial rentup to sustaining occupancy beyond 18 months and where the Borrower has clearly demonstrated successful experience with developing such projects in the recent past. Such projects may require larger operating deficit or debt service reserves.