Different types of property development lending are available for each different stage of the project. This can typically be broken up into:

• Site loans to cover the acquisition costs of the land, development application and other pre-construction costs

• Construction loans to cover the “hard costs” directly related to the actual building of the project, such as equipment, materials and labour

• Mezzanine finance or preferred equity to cover any funding shortfalls, such as “soft costs” including permits, plans and inspections

• Residual stock or reverse equity loans if the developer intends to retain part or all of the completed project as a long term investment

Finance for property developers has several different features to a normal home loan, including interest capitalisation and staged payments. Interest capitalisation allows the borrower to have the interest added to their total loan amount with no payments made until completion. Property development loans are also paid to the borrower as each stage of the project is completed rather than a lump sum upfront. These stages are typically the deposit, base, frame, lock up, fixing, and completion.

As an experienced property development finance lender, HoldenCAPITAL Partners recognises that every project is different and therefore requires a unique solution for property development funding. We work alongside developers to help them grow their business and develop a pipeline of projects with our flexible terms, competitive pricing and fast approvals for private development finance.

HCP typically works with privately-owned entrepreneurial-style developers who have two to three projects on the go at any one time across their portfolio. That ranges from experienced property developers doing 400 to 500 house and land packages a year down to boutique owner-builders. We provide financing for development projects such as townhouses, units, land subdivisions, and mid to high-end houses.

Many of our clients have traditionally sourced funding from major banks, but are now turning to private lender development finance. Banks are risk averse and require a certain level of pre-sales with property development loans. Funds from pre-sales are held on trust and can’t be used to help finance the project. Banks may require up to 60% of the project to be pre-sold before providing finance for property developers.

Rapidly changing market conditions can have a dramatic effect on project profitability. HCP offers minimal or no presales development finance from a private lender to help our clients get their projects underway without the potential costly delays associated with bank lending. Our team can get a quality surveyors report, build contract, project feasibility, and tie it all together and settle in two weeks.

HCP’s solutions for private development finance give our clients more flexibility with how they utilise their capital. We can provide everything from site acquisition and progressively drawn construction loans to mezzanine finance and residual stock funding. The terms of our property development loans can be tailored to meet the needs of the developer which allows them to do multiple projects at once.

HCP can assist when you need property development funding in Brisbane, Sydney, Melbourne or anywhere throughout Australia. Since 2017, our team has completed loan facilities exceeding $150 million across some 40+ projects. Our funding capacity has grown and we are now providing property development loans up to $15 million. Submit your scenario today to get express funding from HoldenCAPITAL Partners.