No Presale Construction Funding

We recently funded the construction of a townhouse project in the established Northern Brisbane suburb of Northgate. The project consisted of 3, high end owner occupier spec townhouses, and an existing renovated character Queenslander which would be on a freehold title. At the time (July 2018), major banks were requiring in all cases 100% and 120% presale debt cover, meaning at least 2 of the townhouses would have needed to be presold prior to construction commencing. Red & Co. funded the deal through a specialist construction lender which allowed for the build to commence without pre-sales, and on an affordable rate. Further details of the transaction are as follows:

  • 3 x new townhouses and 1 existing freehold character dwelling, designed and renovated to a high specification
  • Gross realisation of circa $3 million
  • Debt funded of circa $2 million
  • No Pre-sales required prior to advancement of funds
  • No line fee
  • Competitive interest rate and lender establishment fee

The construction lending and banking landscape has changed markedly over the past 12 months. If you aren’t in the market on a regular basis, it is hard to keep abreast of all the changes that are continually occurring. Red & Co. assist developers with these transactions every week and know the ins and outs of the construction funding landscape. For a chat about your project call Greg Turner on 0417 698 345, or email [email protected].