Challenging conditions didn't stop DFP from helping their client to secure funding for the redevelopment of an existing site.
Development Finance Partners (DFP) was engaged by its client, a boutique property development group, to assist with finance. They needed support to acquire an existing mixed use residential and commercial property in the Northern Rivers region of NSW, for future re-development as an upmarket townhouse project.
The Key Issue in Sourcing Funds
There were a couple of significant challenges in funding the purchase. These included:
- The regional location, with strong Lender preference for metropolitan locations
- A softening property market
- Supply chain and other cost pressures impacting margins on developments and the value of development sites
- Uncertainty caused by recent and ongoing flooding incidents in the region impacting;
- Regional economic activity, and;
- Potential increased Government / Council mitigation and planning requirements
Under difficult conditions DFP was able to leverage the strong relationship with its capital partner to facilitate a viable funding package geared to a 60% loan to value ratio, documented on attractive terms. Significantly, the transaction was completed and booked for settlement on a four (4) week turn around.