In Development Finance, it is important to find a balance between banks requirement of a 100 per cent preselling and developers needs. Below are case studies on selected projects we have on our books.
5 Luxury Apartments in Toorak – 1 presale
Our client owns an owner occupied property and used the equity of his place of residence. He demolished his own house and established a commercial loan of $6,000,000 to build 5 luxury apartments.
The client then value the project at $4,000,000 and we were able to arrange 100 per cent in finance to meet the build cost and interest.
We managed to obtain this development loan with only 1 presale. This was a big win for our developer client who is able to commence construction relatively quickly in further presales.
17 Apartments in North Melbourne
Client had a loan of $4,000,000 to refinance the land loan, weekly build cost, contingency council contribution fee and capitalised interest.
This loan was lower than 65 per cent of the end sales value excluding GST and 75 per cent of development cost. The bank’s approval includes pre sales of $3,000,000 or 75 per cent of the loan.
5 Units Developments in Highett
Client required a loan of $1,300,000 to develop 5 apartments in Highett. The loan was used to finance 100 per cent of the build cost, meet any contingencies and pay interest accrued during the development.