balmain + commercial + big deals + december 2008
Construction Funding
February 09
| purpose | To provide funding for the construction of a 60-unit residential complex located in the northern suburbs of Brisbane. The development is being constructed in one stage due to the market demand for the end product. |
| loan limit | 80% of Total Development Costs, including marketing and other "soft" costs and also including a provision for capitalization of interest. |
| lvr | 75% |
| loan term | 12 months |
| facility type | Investment |
| interest rate | 2.75% margin over BBSW, plus a 0.50% Line Fee calculated on the Loan Limit. |
The clients had secured a significant level of pre-sales for the development to demonstrate market demand, but in the current difficult credit environment were having trouble securing the construction funding level they required from their previous main lender (who had funded the site acquisition 12 months earlier).
Balmain was able to introduce the clients to a commercial development funder they had not previously dealt with. By anticipating the depth of analysis required to satisfy their new funder's credit staff on both the builders capacity to deliver the end product and the validity of the pre-sales achieved to date, we were in a position to deliver a slightly higher funding level than was originally expected.
balmain + commercial + big deals + december 2008
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