How to finance a construction or real estate development project in the Dominican Republic in 2026

September 14, 2026

SANTO DOMINGO – Undertaking a construction project, whether it's an apartment building, a tourist development, or a low-cost housing complex, requires a very different type of financing than the mortgage loan someone takes out to buy a home. The developer needs capital before there's a property to serve as collateral, needs to release that capital in stages as construction progresses, and, in many cases, requires legal structures to protect both their investment and that of those who buy off-plan.

Over the years, the Dominican financial system has developed several instruments specifically designed for this purpose. Banreservas, the state-owned bank, has a portfolio dedicated to the construction sector exceeding RD$21 billion, and alone accounts for approximately 29% of all financing provided to this industry by the Dominican banking system. Alongside commercial banks and savings and loan associations, other mechanisms exist, such as real estate development trusts and CONFOTUR tax incentives, which do not replace bank loans but substantially alter a project's financial viability.

This guide reviews, with information verified in official sources, the main financing options available for a construction or real estate development project in the country, how each one works, and what to evaluate before deciding which one is right for a particular project.

1. Why financing a project is different from financing a home

A traditional mortgage is secured against an existing property and is disbursed in a single payment at closing. Financing a construction project works very differently.

The disbursement occurs in stages, generally linked to the physical progress of the work, and not all at once at the beginning of the project.
The guarantee is usually the land itself and the project under development, rather than a finished property, which requires the financial institution to conduct a technical evaluation of the timeline, budget, and commercial viability of the development.
The term of the financing is usually shorter than that of a residential mortgage, as it is designed to cover the construction period and, in many cases, is transformed or canceled once the units are sold and their buyers access their own individual mortgage loans.
The legal structure of the project (whether it operates as a traditional construction company or under a real estate development trust) largely determines what financing instruments are available and how the money of the various participants is protected.

2. Interim loans

The interim loan is currently the most widespread financing mechanism among construction companies and developers in the country. It is a loan specifically designed to support the execution of a project, with disbursements made in stages as construction milestones previously agreed upon with the financial institution are met.

the types of projects it financesinclude real estate development and construction projects of residential units intended for sale, urban development projects of plots of land with basic infrastructure, investment projects such as clinics, schools or shopping centers, and real estate development trusts in different phases of design and construction.
How the money is released: the entity determines the amount of disbursements and their frequency according to the actual progress of the work, verified through technical inspections, instead of delivering the total amount at the beginning of the project.
Its weight within the Dominican financial system has grown steadily in recent years, driven by measures to release resources from the Central Bank's legal reserve, which have allowed more funds to be channeled to the construction sector at preferential rates.
The service is usually personalized, as each entity evaluates the conditions of the interim loan according to the developer's profile, the type of project and its location.

3. The real estate development trust

Beyond traditional bank credit, Law 189-11 for the Development of the Mortgage Market and Trust introduced into the Dominican financial system a figure that is now central to the financing of larger-scale projects: the trust.

What is it? The law itself defines it as the figure by which a person (the settlor) transfers assets or rights to another (the trustee) to administer them according to specific instructions, for the benefit of one or more beneficiaries.
Who can act as a trustee? Only legal entities constituted in accordance with Dominican law whose sole purpose is to act as such, in addition to multiple banks, savings and loan associations, and other financial intermediation entities specifically authorized by the Monetary Board.
Because it protects investors and buyers, the trust assets are kept separate from the personal assets of the settlor, the trustee, and the beneficiary, and as a general rule, they cannot be pursued by the creditors of any of them, except for the exceptions provided by law in cases of fraud against third parties.
What is it used for in the construction sector? A real estate development trust allows pre-sale funds, investor funds, and credit lines to be channeled into a single structure managed by the trustee, who releases the money to the developer as construction milestones are met, instead of those funds passing directly through the personal or corporate accounts of the developer.
At its most advanced level, the same law enables instruments such as the securitization of mortgage portfolios and mortgage bonds, mechanisms that allow the channeling of resources from the capital market towards housing finance, regulated by the Superintendency of the Securities Market (SIMV).

4. CONFOTUR's tax incentives as a financial lever

For projects with a tourism focus, the incentive regime of Law 158-01, known as CONFOTUR, is not a direct financing instrument, but it fulfills an equally important financial function, substantially improving the profitability and bankability of a project in the eyes of investors and credit institutions.

What exempts, an approved project is excluded from Income Tax for those who undertake, promote or invest in the activity, from Real Estate Property Tax for a period of up to 15 years, from the payment of fees and rights for the preparation of plans, studies, consultancies, supervision and construction of the works, and from national and municipal taxes for the constitution of the companies linked to the project.
What requirements does it demand, including an architectural preliminary project, an economic feasibility study, the no objection permit for land use from the Planning and Projects Department of the Ministry of Tourism, the corresponding municipal authorizations and the environmental authorization from the Ministry of Environment.
How to apply: The application is made through the Central Unit of Tourist Procedures (UCTT), the digital portal of the Ministry of Tourism, and you can first obtain a Provisional Classification while the project is still formalizing its permits, and then a Definitive Classification.
Which projects qualify?They must be located in areas designated by the law as tourist hubs or areas of limited development, and the only valid document to confirm that a project has these benefits is the official resolution issued by the Ministry of Tourism, not the developer's commercial advertising.

5. Public-private partnerships for low-cost housing

For developers focused on affordable housing, there is also a direct collaboration channel with the government through trust companies linked to public banks. Fiduciaria Reservas, in partnership with the Ministry of Housing, Habitat and Buildings (MIVHED), has channeled financing exceeding RD$7.9 billion since 2020, benefiting more than 4,400 families within government low-cost housing programs.

As explained in a previous guide from El Inmobiliario on mortgage financing, the Ministry of Housing and Urban Development (MIVHED) suspended the acceptance of new applications for the Familia Feliz and Mi Vivienda programs from end buyers in May 2026, while it focuses on completing the 45 housing projects already underway. For developers, this means that the option to participate as a builder in these already approved projects remains open, although the possibility of incorporating new units under this specific scheme is currently closed. It is advisable to verify the current status directly with MIVHED before structuring a project assuming this backing.

6. Complementary traditional bank financing

Beyond interim loans, banking institutions offer other products that are often combined with the financing of a construction project.

Revolving lines of credit, which allow a construction company to access a pre-approved amount and make multiple disbursements as required, paying a monthly interest installment with the principal payable at the maturity of the facility.
Working capital financing, both short and long term, intended to cover the company's operational needs that are not directly linked to a specific project.
Larger-scale corporate facilities, available to developers with a proven track record, are often combined with interim loans to cover all the financial needs of a construction company with several simultaneous projects.

7. How to choose the right financing structure

The right combination of tools depends, above all, on the size, type, and location of the project.

A medium-scale residential project is usually supported mainly by an interim loan from the bank, supplemented by individual mortgages requested by the final buyers as the pre-sale progresses.
A larger project with multiple investors often benefits from operating under a real estate development trust, which provides transparency and legal protection for the funds of all participants.
A tourism project located in an eligible area should assess from the preliminary project stage whether it qualifies for CONFOTUR benefits, since applying after construction has begun reduces the margin for maneuver and can complicate the approval schedule.
A low-cost housing project can explore partnerships with trust companies linked to public banking, although it is advisable to first confirm whether the project can be incorporated into any active government program.

What's happening in 2026?

The performance of financing to the construction sector during 2026 shows that public banks continue to expand their exposure to this industry. Banreservas has publicly reaffirmed its intention to maintain and increase its construction loan portfolio, supported by a base of more than 28,470 clients in this segment, primarily concentrated in Greater Santo Domingo and Santiago de los Caballeros. The institution has also highlighted the role of its Real Estate Alliances unit and Fiduciaria Reservas in providing specific support to low-cost housing projects, in coordination with the Ministry of Housing and Urban Development (MIVHED).

At the same time, as previously explained, MIVHED itself closed the acceptance of new applications from buyers for the Familia Feliz and Mi Vivienda programs in May 2026, while focusing its efforts on completing already approved projects. Neither of these two moves modifies the legal framework of the trust or the CONFOTUR incentives, which remain in effect without regulatory changes this year. However, it is advisable to keep them in mind when deciding which financial institutions to partner with for a new project.

8. The most common mistakes when seeking funding for a project

Several of the obstacles that Dominican developers face when seeking financing have a common origin: treating financing as a last-minute formality rather than a structural decision of the project.

Applying for an interim loan without a sufficiently detailed construction schedule is a mistake. Financial institutions need clear construction milestones to design the disbursement schedule, and a vague schedule usually results in less favorable terms.
Mixing pre-sale funds with the company's general operating accounts, instead of channeling them through a real estate development trust, exposes both the developer and buyers to unnecessary risks.
Applying for CONFOTUR approval after construction has begun is not the appropriate time to evaluate and process these benefits. This is during the preliminary design phase, not once construction is already underway.
Assuming that a low-cost housing project will automatically qualify for financing through government programs, without first verifying the current status of those programs with MIVHED.
Relying on a single financial institution for all project financing, without exploring a combination of interim loans, complementary credit lines, and trust structures that could reduce the overall cost of capital.

Official sources consulted

Superintendency of Banks (SB) — Text of Law No. 189-11 for the Development of the Mortgage Market and the Trust
Superintendency of the Securities Market (SIMV) — Regulation of trusts and securitization of mortgage portfolios https://simv.gob.do
Tourism Development Council (CONFOTUR), Ministry of Tourism (MITUR) — Requirements and benefits of Law No. 158-01
Banreservas — Official description of Interim Loans and financing for the construction sector

How to finance a construction or real estate development project in the Dominican Republic in 2026