How did this family build their dream cottage on time and on budget?
For some people, building a custom cottage is the ultimate dream, but knowing how and where to start can be the hardest part. For Drew Donaldson, Managing Partner at Safebridge Financial, it was the easy part. Drew had extensive experience working with builders and private lenders in Toronto, so he knew how the process worked. When the opportunity popped up to buy some family land in Muskoka, Drew jumped at the opportunity and built a beautiful 3,500 sq ft custom cottage. His experience in the industry allowed his family to complete the project on time and on budget. Here’s how.
Adam: Can you tell me why you decided to build a cottage?
Drew: It was really about taking advantage of an opportunity. We weren’t in the market for a cottage at the time but, with a child under the age of two and another one on the way, we started considering a getaway for the family. My grandmother’s estate happened to be selling some property on Lake Rosseau in Muskoka. They had two plots of land, one on an island and another on the mainland. When they sold the island property separately, we realized that this was our chance to buy something we could afford on the mainland, even though it was smaller. We began painting a vision of what we could build.
Adam: Can you tell me a bit about how financing worked? Specifically as it relates to construction and land?
Drew: At the time, there was just a boathouse with some living quarters on top but no cottage on the mainland piece, which was the challenge from a financing perspective. We were able to pay cash for the land, then arranged private money for the construction, knowing that we’d only need it for that phase. It was more flexible than institutional financing but the rate was higher, so once we got the cottage built, we refinanced to a Schedule A bank mortgage at a premium rate.
Adam: Were there stages of the building process? Did you have to get to certain points of construction to get the next financing draw?
Drew: I think in total there were 5 stages where they would release more money to our contractor: Completing the foundation, framing, drywall, etc. We let him know ahead of time when he could expect payment. Our private construction lender was very accommodating. He went out to view the property a few times; other times we’d send him photos and he’d release the money the next day. We had no challenges as far as liquidity on that.
Adam: What about style of cottage? How did you and your wife and family decide on the style of cottage?
Drew: When we originally started, we wanted to replicate the old island cottage that was sold. As we got into the permit and planning stages, we had to adjust those plans but in the end we went with a traditional Muskoka look over a modern one. We included a Muskoka room, hung a canoe in the kitchen, and did other things to make it feel warm and cottage-like.
Adam: Can you talk about any learning experiences that you had along the way? Anything you would advise someone else who’s looking to build a cottage?
Drew: We waited until the fall to start on the cottage build, knowing that we had all winter to get it completed. It turns out we didn’t leave enough time for the planning and permit stages, which caused some delays with the Township of Muskoka Lakes. Nobody’s fault, but several times they had a few questions and wanted further clarification on things. That delayed us putting the shovel in the ground until November rather than the end of September. Over the winter, we caught up enough to achieve our goal of May 2017 occupancy but, if we were doing it again, we would have allowed more time upfront.
Adam: Lastly, did you decide to go with a local contractor and how were you able to manage this all from Toronto?
Drew: We interviewed a few local contractors in Muskoka but we weren’t getting the answers we wanted, and they weren’t very flexible about where they’d source the materials. In the end, we decided to go with a Barrie, Ontario contractor who does a lot of work in the GTA, but also gets pulled into Muskoka. He was able to coordinate most of his trades up there at a slightly better price, even though occasionally we had to put them up in hotels. For us, the quality was just as good if not better, and we had full trust and transparency all the way through.