Background
Development Finance Partners (DFP) was engaged to structure and secure landbank funding for a pre-DA industrial development site located in Laverton, Victoria. The site was originally secured through an off-market option contract 12–18 months earlier, during which time it experienced significant uplift in market value.
The developer, a highly experienced operator with over 30 years in Melbourne’s residential, office, and industrial sectors, sought a facility that would leverage the increased valuation without the need to reduce the original purchase price. Their objective was to minimise upfront equity and retain momentum on what would become an 18-unit strata industrial development.
Due to DFP’s success in delivering this funding solution, the client has since retained DFP to secure finance for three additional group developments, totalling approximately $50 million in future funding.
Project Overview
The site is earmarked for a future 18-unit industrial strata development, strategically located within one of Melbourne’s established industrial hubs. The developer required a short-term landbank facility to settle the acquisition, finalise development approvals, and then transition seamlessly into construction finance.
Key Metrics
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Loan Amount: $7,700,000
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Loan Type: Landbank Finance
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Term: 6 months (with a 3-month minimum)
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Security: Pre-DA industrial development site
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Location: Laverton, VIC
The Challenge
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The site was not DA-approved at the time of funding
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The developer sought to borrow against the uplifted valuation, not the original purchase price
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The transaction required a high LVR facility with minimal equity contribution
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A tight settlement timeline was in place due to the expiry of the option contract
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The facility needed to include capitalised interest and costs, and accommodate planning and construction approval timelines
DFP’s Strategic Solution
DFP undertook a comprehensive credit assessment of the proposal, including:
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The real estate fundamentals and location dynamics
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The developer’s track record and group structure
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The planning status and timeline to DA and construction commencement
DFP then promoted the deal to its capital network, coordinated lender negotiations, and secured a facility that:
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Was structured around the uplifted valuation
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Included interest and fee capitalisation
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Provided buffer time for development approvals
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Allowed a seamless roll into construction finance upon DA approval
The transaction was successfully settled between July and August 2023.
Results and Benefits
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$7.7 million landbank facility secured
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Minimal equity contribution required
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Interest and costs capitalised, preserving developer cash flow
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Funding aligned with planning milestones, with built-in time buffers
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Positioned to roll directly into construction finance
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Client retained DFP for $50M in additional finance across three more projects
Conclusion
This case illustrates DFP’s expertise in structuring flexible landbank finance for non-DA-approved development sites. By securing a $7.7M facility aligned to valuation uplift and planning timelines, DFP enabled the developer to move confidently into the next phase of a strategic industrial project, while preserving capital and maximising long-term value.
Whatever the size of your development plan, DFP have a wealth of experience and strong relationships to help you succeed. Contact us to explore your tailored finance options.
