During the past 12 months, I was fortunate to be able to complete the Advanced…
A partner of an established Professional Services firm was seeking property development finance for a small three-townhouse unit project.
The Challenge - Property Development Finance
Even experienced developers, are finding access to such finance increasingly difficult.
The Client Dilemma
Even though our client intended to retain the properties as part of their longer-term wealth creation strategy, the existing Bank declined support due to concerns around debt servicing.
This being despite the fact the client was a partner in an established & profitable firm.
Another Lender indicated a preparedness to provide the requested property development finance, however required the firm and it’s partners to refinance to them.
This step was not palatable to our client due to the potential disruption this would involve for the firm.
The Solution & Outcome
As a starting point, we undertook a full review of both the professional services firm and our client’s townhouse development project.
Through this, we were able to demonstrate the capacity of the partner to service the proposed property development finance on a “build to hold” basis.
We then approached another Lender.
Not only was the client need satisfied, but due to our involvement, the firm’s existing Bank reduced the interest-rate for the firm, from 5.5% to 3.07%, in order to protect the relationship.
This is a great example as to the benefit of undertaking a full review before approaching the market.
To do otherwise, invariably leads to less-than-ideal outcomes, causing a lot of frustration and delays.
This is why we developed, & advocate for, our Loan and Bankability process.
If you’re looking for finance and would like to learn more, don’t hesitate to give me a call.