Case Study | Commercial Property Finance, Illawarra Region, NSW

DFP secured finance to acquire two strata units within 4 days at
a LVR of 137%.

Background

The borrower engaged with DFP to assist with the procurement of finance, to avoid no completion of the contract.

The client had engaged with a reputable valuer to undertake an on-completion valuation subject to two new leases being committed with fit-outs to commence following settlement. The issue, however, was that the client required maximum lending exposure to settle, given the growth of his other property portfolios.

The valuation was finalised and supported the clients' expectations, however, lenders needed to gain the comfort of the sponsor, the project and the on-completion valuation.

DFP worked closely with both lenders to mitigate concerns around the initial LVR position and on-completion position. Given the commercial nature of both lenders, they were in a position to assist and move quickly to meet and exceed the clients' expectations.

Location of Project

Illawarra Region, NSW

The subject property comprises twp strata titled units within a small complex with rear lane access to undercover parking. Ideally suitable for office or retail use, located close to the hospital and medical specialists and public transport links.

The Developer

The developer has undertaken many successful projects and has a decade of successful fit-out and development project works under his belt, which provided a level of comfort to the lenders. Also, an arm’s length lease was in place with the major tenant, which underpinned the valuation.

The Results

Fast and Flexible Commercial Acquisition Finance | 4 Day Turnaround

DFP was engaged to provide a quick and reliable funding solution.

Due to the time constraints, DFP engaged with a tried and tested 1^st mortgage lender and also engaged with a 2^nd mortgage lender who had previous experience with the client and was happy to support.

Timeframe:

• 23^rd June – Received both 1^st and 2^nd mortgage letters of offer from the respective lenders
• 24^th June – The client accepted and sign both letters of offer
• 27^th June – Loan documents from 1^st and 2^nd lenders distributed to the clients’ solicitor for signing
• 28^th June – Loan settled

DFP Delivered

DFP facilitated and maintained close contact with all parties, the client, his solicitor, and the 1^st and 2^nd mortgage lenders to ensure all parties were aligned to meet the tight deadline.

This was a complex deal, from navigating the extraordinary and complex LVRs, managing the valuation process, coordinating lenders and the documentation process and required the experience of the DFP team, so finance was efficiently managed and settled. A great team effort all the way around.

1st Mortgage: 

• 90% on purchase price
• 60% of on-completion valuation

2nd Mortgage:

• 137% on purchase price
• 85% of on-completion valuation

If you are seeking finance to secure your next commercial property, get in touch with us today.