The client was an experienced property developer with a diverse track record delivering residential subdivisions and construction projects across regional Victoria.
Having successfully secured a strategic development site, the developer sought a funding solution that would support the project from land acquisition through to construction while maintaining flexibility throughout the development lifecycle.
The project involved the subdivision of a 4.826-hectare site in Shepparton East, Victoria, to deliver 18 residential lots.
The development included the construction of roads, stormwater infrastructure, sewer, services and footpaths to create a fully serviced residential subdivision. Following the initial land acquisition, the developer required construction funding that would support project delivery without relying on presales.
Key Metrics
Loan Amount: $4.018 million
Location: Shepparton East, Victoria
Project Type: 18 Lot Residential Subdivision
Facility Type: Construction Facility
LVR Against Valuation: 65%
Loan to Cost: 73.12%
Presales: Nil
Following site acquisition, the developer needed to transition into construction funding while maintaining project momentum and meeting lender requirements.
The funding structure also needed to align with the commercial requirements of the project's civil contractor while providing sufficient flexibility around project costs. Rather than committing unnecessary equity upfront, the developer wanted the flexibility to fund selected project costs directly as construction progressed.
At the same time, the lender needed confidence in the project's construction risk controls and delivery framework despite the absence of presales. Achieving the right balance between lender requirements, contractor expectations and funding flexibility was essential to keeping the project on schedule.
Development Finance Partners initially assisted the client in securing a land bank facility, creating a clear funding pathway from site acquisition through to construction.
As the project progressed, DFP guided the transition into a senior construction facility, ensuring all lender requirements, reporting obligations and project milestones were satisfied.
A streamlined senior debt structure was negotiated that aligned with both the project's funding requirements and the developer's preferred capital strategy. Importantly, the facility provided flexibility around cost contributions while supporting construction without requiring presales.
By coordinating the transition between facilities and managing lender, legal and documentation requirements, DFP delivered a funding solution that supported uninterrupted project progression.
Development Finance Partners successfully secured the construction facility, allowing the project to progress from land acquisition into civil works without interruption.
The funding structure provided the flexibility the developer required, while satisfying lender and contractor requirements and supporting efficient project delivery.
Most importantly, the seamless transition from land bank funding into construction enabled the developer to maintain momentum, preserve capital and continue delivering the project in line with their broader development strategy.
This transaction demonstrates the value of planning funding strategies across the entire development lifecycle rather than treating acquisition and construction as separate events.
For experienced developers, establishing a clear funding pathway from land acquisition through to construction can improve project certainty, preserve flexibility and reduce delays as projects progress through key milestones.
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.