A developer plans to start the construction of an office building in October 2024, and finish it in December 2024.The total construction time is 3 months.

The total hard costs, soft costs and site improvements are $900,000. The land acquisition will cost the developer $100,000.

The developer arranges a construction loan. The construction loan finances the hard costs, soft costs, site improvements and interest-carry. The loan has a 12% annual rate and a fee that equals 1% of the ending balance.The fee needs to be paid before construction begins.

The developer will draw one third of the financed construction costs at the end of each month.

How much equity does the developer need to contribute to the project?