Loans
Development finance
Development finance is staged funding for a property build, subdivision or project — the land funded first, then construction released in progressive draws against works completed. It's sized on project cost and end value rather than your full financials, and repaid when the project sells or refinances.
Indicative only — subject to assessment. Placeholder figures.
How development finance works
Development finance funds a project in stages rather than as a single advance. The land or site is funded first, then construction is released in progressive draws — each one paid against works actually completed and usually signed off by a quantity surveyor. Interest is typically capitalised into the facility, so there’s nothing to service month to month while you build. The loan is sized on the numbers that matter to a project: its total cost, and its gross realisation value (GRV) — the expected end value of the finished stock, net of GST. It’s repaid when the project completes, from the sale of stock or a refinance into longer-term finance.
What it funds
Development finance covers residential, commercial and mixed-use projects held by a company or trust for a business purpose — townhouses, apartments and unit developments, small-lot subdivisions, warehouse and industrial builds, and owner-occupier commercial premises. It’s also called construction finance, and the same facility can cover both the land and the build. The capital is assessed against the project — the site, the feasibility, the builder and the exit — not your full financials and historical serviceability, which is what lets it move where a bank runs weeks.
How it’s sized and priced
A development deal is read through two ratios at once: loan-to-cost — how much of the total project cost is funded — and loan against GRV, net of GST. The banks generally want substantial presales before they release construction funds; assessed on project economics instead, a development facility can proceed with limited presales, or sometimes none, where the margin, the builder and the exit stack up. Pricing reflects the risk the project carries, so the figures here are representative and set on assessment. Full current terms are on our rates and fees page.
What we’ll need
A feasibility with realistic costings and end values, your fixed-price building contract or costings, the development approval (or where it’s up to), and a clear exit — the sale program or the refinance that repays the facility. The picture is what we work from; the file stays as light as the deal allows.
- Companies, trusts and developers with a costed, feasible project and a clear margin
- Residential, commercial or mixed-use builds, subdivisions and multi-unit projects
- Projects needing staged drawdowns and a sell-down or refinance exit
- Owner-occupiers building their own home (business-purpose only)
- Speculative projects without approvals, a realistic feasibility or an adequate margin
- Developers without equity in the project or a credible exit at completion
How it compares
FAQ
How is development finance different from a normal property loan?
It's released in stages against works completed, not as a single advance, and it's sized on the project's total cost and end value rather than just the land's current value. Interest is usually capitalised, so there's nothing to service while you build.
Do I need presales to get development finance?
Not always. The project is assessed on its economics — the margin, the builder and the exit — so a facility can proceed with limited presales, or sometimes none, where the numbers stack up. The banks are generally stricter on presales than a project-assessed facility.
How are the funds released?
Progressively, in stages tied to construction milestones, with each draw paid against works actually completed and usually verified by a quantity surveyor.
How is the loan sized?
Against loan-to-cost (a share of total project cost) and a percentage of gross realisation value — the end value of the finished project, net of GST — not just the current value of the land.
Who can borrow?
Australian companies, trusts and developers for a business purpose. Development finance is not consumer lending, and it isn't for an owner-occupier building their own home.
Tell us about your project.
The project, the numbers and the timeframe. We'll review and come back to you fast.
You deal with us start to finish.
Enquire
Send an enquiry
Takes two minutes.