The Urban Developer
AdvertiseEventsWebinars
Urbanity
Awards
Sign In
Membership
Latest
Menu
Location
Sector
Category
Content
Type
Newsletters
Untitled design (8)
2 WEEKS UNTIL OUR UNMISSABLE FLAGSHIP CONFERENCE MORE THAN 550 ALREADY ATTENDING
2 WEEKS UNTIL OUR FLAGSHIP CONFERENCE 550+ ALREADY ATTENDING
REGISTER NOWDETAILS
TheUrbanDeveloper
Follow
About
About Us
Membership
Awards
Events
Webinars
Listings
Resources
Terms & Conditions
Commenting Policy
Privacy Policy
Republishing Guidelines
Editorial Charter
Complaints Handling Policy
Contact
General Enquiries
Advertise
Contribution Enquiry
Project Submission
Membership Enquiry
Newsletter
Stay up to date and with the latest news, projects, deals and features.
Subscribe
OtherStaff WriterTue 23 Jun 15

Helping A Client Get A Higher LVR

TUD+ MEMBER CONTENT
i
SHARE
print
Print

Helping a client get a higher LVR (70% of valuation) for Land Bank ACT prior to DA.


As bank conditions tighten for many developers, working with an experienced development finance specialist is helping them overcome funding hurdles. This scenario shows how a specialist financier can add value to developers.

The scenario


A client approached Development Finance Partners (DFP) to assist with providing finance to purchase a development site with a purchase price of $1.82m.  A DA was in the final stages of being lodged for a 16-unit residential development.  A letter had been provided by the architect which indicates that the plans are complicit with the Local Planning guidelines and that a DA is highly probable.

Issues


The client wanted to maximise the loan to value ratio and mainstream funding options are limited for land banks without development consent.

ALSO SEE: IProperty Group Increases Guidance For 2015

The solution


DFP was engaged to expedite a funding solution that met the client’s requirements of a lower loan to value ratio.

DFP undertook a detailed analysis of the feasibility of the proposed 16-unit development and take out options for the underwrite. DFP then completed underwriting proposal.

Results


DFP has been able to provide funding from the private market that meets with the client’s requirements. The LVR is 70% of the “as is” value.

This will enable the client to secure the site, obtain DA and refinance the land bank loan into construction.

DFP was able to present the proposal on the basis of the overall financial strength of the client, the minimal planning risk around the DA and the take out options under a construction facility.

What the client says


Daniel Hausman, Managing Partner of Aventis Group, who introduced the client to DFP was very happy with the outcome of his introduction and recommendation. “The land had the relevant zonings but a DA had yet to be lodged. My brief, on behalf of the developer, was to organise a land bank facility for the raw land and a high LVR. I called DFP because I knew they had the contacts and expertise to do it. DFP were able to get us 87.3 per cent TDC, with a component of PE [preferential equity] at a very reasonable rate – which my client was delighted to take because it meant they could keep that extra money for other deals.”

ResidentialInternationalFinanceSector
AUTHOR
Staff Writer
"TheUrbanDeveloper.com is committed to delivering the latest news, reviews, opinions and insights into the best of urban development from Australia and around the world. "
More articles by this author
ADVERTISEMENT
TOP STORIES
The Port of Brisbane has released its Vision 2060 which details the need for inland rail connectivity
Infrastructure

Brisbane Port’s $15bn Future Faces One Big Obstacle

Renee McKeown
5 Min
Freecity Rouse Hill triple towers 2 Tempus Street
Exclusive

Freecity Takes Covers Off $330m Triple Towers in Sydney’s North-West

Leon Della Bosca
5 Min
Parallel Workshops Stockdale Housing PBSA project
Exclusive

Suburban Success Story Turns PBSA Thinking on its Head

Leon Della Bosca
7 Min
Exclusive

Interstate Developers Find Lots to Love in ‘Progressive, Affordable’ SA

Taryn Paris
5 Min
Bates Smart Richmond Sportslink HERO
Exclusive

BtR Focus Drives Bates Smart’s Richmond Sportslink Concept

Leon Della Bosca
6 Min
View All >
Logan Wastewater Funding hero
Infrastructure

Flush of Funding to Deliver 20,000 New SEQ Homes

Phil Bartsch
Stockland's Triniti HERO
Build-to-Rent

Stockland $400m North Ryde BtR Approved on Appeal

Leon Della Bosca
The Port of Brisbane has released its Vision 2060 which details the need for inland rail connectivity
Infrastructure

Brisbane Port’s $15bn Future Faces One Big Obstacle

Renee McKeown
Global ports shift up to 30 per cent of containers by rail—Brisbane moves less than 2 per cent. Here’s why that’s a prob…
LATEST
Logan Wastewater Funding hero
Infrastructure

Flush of Funding to Deliver 20,000 New SEQ Homes

Phil Bartsch
3 Min
Stockland's Triniti HERO
Build-to-Rent

Stockland $400m North Ryde BtR Approved on Appeal

Leon Della Bosca
3 Min
The Port of Brisbane has released its Vision 2060 which details the need for inland rail connectivity
Infrastructure

Brisbane Port’s $15bn Future Faces One Big Obstacle

Renee McKeown
5 Min
Industrial

Inland Rail: Site at Rural Hub Comes to Market in Victoria

Lindsay Saunders
2 Min
View All >
ADVERTISEMENT
Article originally posted at: https://theurbandeveloper.com/articles/helping-client-get-higher-lvr