Background
Development Finance Partners (DFP) was engaged by a Perth-based development group to secure construction funding for a three-part residential project in North Perth, WA. The client’s strategy involved renovating an existing home, subdividing the rear block, and constructing a new dwelling on the subdivided land.
The developer and builder were related entities who had previously collaborated on multiple projects. However, their owner-builder structure created funding roadblocks with major lenders. Recognising DFP’s expertise in working with non-bank funders and complex deal structures, the group turned to DFP for a flexible finance solution.
Project Overview
The project involved:
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Renovation of the existing front property
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Subdivision of the rear land parcel
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Construction of a new home on the rear lot
To maximise gearing and reduce capital outlay, the clients offered additional property as security, allowing DFP to enhance the equity position and secure the required facility.
Key Metrics
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Loan Amount: $2,400,000
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Loan Type: Development Finance
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LVR: 65%
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Term: 12 months from first drawdown
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Security: Project site + additional property
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Location: North Perth, WA
The Challenge
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Major lenders were reluctant to fund owner-builder structures, even for experienced operators
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The clients needed to fund multiple project phases under a single facility
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Required use of cross-collateralisation to reduce upfront equity injection
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Timing and flexibility were essential to align construction and subdivision milestones
DFP’s Strategic Solution
DFP structured a $2.4 million development facility at 65% LVR, using both the project site and an additional property as security. By leveraging its trusted capital partner network, DFP provided a lender that:
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Accepted the owner-builder structure under a Tri-Partite agreement
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Allowed for a phased funding drawdown, aligned with the project stages
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Approved the structure within a tight timeframe, ensuring no project delays
This solution enabled the clients to retain control of the build, maximise leverage, and proceed with confidence.
Results and Benefits
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$2.4 million facility secured for renovation, subdivision, and new build
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65% LVR approved, supported by additional security
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Tri-Partite agreement allowed for owner-builder delivery
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Funding structured to support multiple project phases
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Capital contribution reduced, supporting stronger project cash flow
Conclusion
This case highlights DFP’s ability to deliver tailored development finance for owner-builders and related development entities. By structuring a flexible, multi-stage facility backed by additional security, DFP enabled the clients to move forward with confidence in a tightly held inner-Perth suburb.
If you're exploring your development finance options, DFP have various solutions that suit a number of different purposes. Contact us to explore further.
