Debt Moratorium

Hi folks, I am trying to model the debt repayments and interest payments as part of a financing schedule for a construction project. Appreciate your clarifications on some points: 1) Does the moratorium period (2 years based on project write-up) start from the “first date of drawdown” OR from the “first day of operations” OR …? 2) To confirm: Debt moratorium applies only to debt repayments; Interest payments are treated usual way i.e. during construction period as IDC, after construction expensed per normal. Thanks in advance for your advice, cfaprincess

  1. From the construction loans I’ve seen, it starts at the first funding. 2) Not sure what you mean, but typically interest payments are taken from an interest reserve, which is funded up front, until the project is completed/stabilized. That pretty much sounds like what you’re describing. They’re certainly not going to make amortizing payments until the project is done and occupied…

Thanks ahahah. Following up on your reply to 2), the interest reserve forms part of the project debt… right? This is what I am used to seeing… however strangely the model I have been provided with doesn’t count IDC as part of project debt.