Property Development Finance in Australia

Make your next investment wisely. Contact our professionals on (03) 9900 6227

Contact our experienced professionals to discuss financing for your next project.

Our commitment at MFEG is to support quality property developers in getting their projects out of the ground efficiently with funding solutions that work. We have put together a process that enables us to quickly assess a project and structure solutions through our network of investors and wholesale funders that suit an individual project and group's needs. Our flexible funding model and great relationships with other industry professionals enable us to support our clients through the project journey from land purchase to completion.

We have established an enviable track record in originating and arranging funding solutions for many projects, entailing a wide variety of project types, including:

  • Residential units and townhouses
  • Land Subdivisions
  • Commercial (retail, industrial, office)
  • Specialised projects (eg. child care centres, medical, hotels)

We are proud to have partnered with many quality developers in delivering outstanding projects to the market and we are looking for more great developers to work with.

Investment Option Melbourne

We help you obtain the right funding

 

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Melbourne Finance & Equity Group - MFEG is committed to ensuring that the collection and processing of data carried out by our mfeg.com.au site complies with the General Data Protection Regulations (GDPR) and the Data Protection Act. To know and exercise your rights, particularly concerning the withdrawal of consent to the use of collected data, please consult our privacy policy
Our services:
  • Property development finance
  • Mezzanine finance
  • Preferred equity
  • Land Finance
  • Residual Stock
  • Short Term Lending
Our Commitment:
  • Over 15 years of experience
  • Professional service
  • Reliability, Responsiveness and integrity
  • Knowledgeable advice
Servicing:
  • All parts of Australia

The Capital Stack

Every homeowner understands the difference between their mortgage and the equity they have in their home, but when it comes to commercial real estate transactions like property development finance, the difference between equity, preferred equity, mezzanine debt and senior debt can confuse even the savviest financial mind.

Let’s look at what’s called 'the capital stack' to better understand where the different types of finance sit in a commercial property development.

Senior debt is secured by a first mortgage on the property itself, so the lender can sell the security property if the borrower fails to pay. This greatly reduces risk on the principal invested because, at worst, the lender can recoup its principal by selling the property.

Mezzanine debt sits behind the senior debt in order of payment priority. Once the developer pays operating expenses and the senior debt payment, all income must go to pay the mezzanine debt. 

Preferred equity is perhaps the hardest portion of the capital stack to speak about generally because, for better and worse, it’s very flexible. Preferred equity holders have a preferred right to payments over regular (common) equity holders. 

Common equity is the riskiest and most profitable portion of the real estate capital stack. Typically, the developer (or sponsor) will be required to invest their own money as some portion of the equity to have skin in the game. 

Understanding the stack is incredibly important as certain lenders will only become involved in particular types of property development finance and interest rates will vary depending on the risk.

If you’d like to discuss finance for your next property development project, please get in touch.

Pairing you with the right person

 

Investment Option Yarra Ranges

Need a team that can help make sense of financing? You’ve come to the right place!

MFEG is thankful to the thousands of clients around Melbourne who trust us to deliver the best financial and funding solutions. Why not contact us today to find out how we can help make a difference for you or your clients?

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Make your next investment wisely. Contact our professionals on (03) 9900 6227

Property development is a continually evolving industry that is vulnerable to sudden shifts in the economic climate. Marketplace conditions can shift and change almost overnight, affecting your project’s profitability. Therefore, it’s critical to ensure you get the right financial advice and guidance from the very beginning. For that, you can turn to the experts at Melbourne Finance and Equity Group  (MFEG)! Call now and let’s have a chat.

Helping You Find the Right Finance

MFEG understands that your needs as a developer can be quite different depending on your experience level and what kind of property you are looking to build. But, whatever your needs, you will need financing to continue growing your business. Whether you’re considering a commercial or industrial development, a residential property development or even subdividing land, our lending specialists can help you fund it.

Property development finance is a loan that can help you fund construction of more than one property on one title. Most banks and lenders split property development into two parts, and both can have very different approval processes, fees and charges, interest rates and risk assessments.

Residential: Most banks and lenders define residential property development as small-scale development (four or five units). This kind of mortgage can have standard fees and charges and is the least risky of the two.

Commercial: If your property development is greater than four or five residential units, banks and lenders are likely to characterise it as commercial property development. This can be anything from a skyscraper to a series of commercial properties. These kinds of mortgage applications can be more complex and often attract a higher interest rate to protect the bank or lender against risk.

Investment Option Melbourne

We help you obtain the right funding

 

Enquiry Form


Text value required
Text value required
Phone number value required
E-Mail address value required
Checkbox mandatory
Please fill in captcha confirmation code
captcha
Melbourne Finance & Equity Group - MFEG is committed to ensuring that the collection and processing of data carried out by our mfeg.com.au site complies with the General Data Protection Regulations (GDPR) and the Data Protection Act. To know and exercise your rights, particularly concerning the withdrawal of consent to the use of collected data, please consult our privacy policy
Our services:
  • Property development finance
  • Mezzanine finance
  • Preferred equity
  • Land Finance
  • Residual Stock
  • Short Term Lending
We guarantee:
  • Over 15 years of experience
  • Professional services
  • Customer satisfaction
  • Reliable and comprehensive services
  • Knowledgeable advice
Serving:
  • All parts of Australia