Case Study: Affordable Housing Project Sutherland Shire NSW $3,100,000
Development Finance Partners (DFP) was engaged to assist its client to procure construction finance for a boutique 8 townhouse project in Southern Sydney. The project is to be developed pursuant to the State Government’s Affordable Housing Scheme, wherein circa 25% of the accommodation is required to be made available for rent to middle income earners at a discount upwards of 20% of market, or a portion of the occupier’s income, for 10 years. In return, the State Government in conjunction with local Councils provides density bonuses in low rise residential precincts.
THE KEY ISSUES
The client has a proven track record in this niche and has produced an innovatively designed complex of one bedroom townhouses. However with it being a still new concept to the market, buyers are reticent to pre-commit until they can inspect the completed product.
A financier who understood the concept and who would importantly be willing to fund without pre-sales was therefore a prerequisite.
DFP was able to call on its strong relationship with capital partners and its experience in previously arranging funding for Affordable Housing Projects to procure funding without pre-sales in line with the client’s requirements, on competitive terms and conditions.
WHAT THE CLIENT SAYS
“I’ve now worked with DFP on several projects and they have become a trusted finance partner in the joint development for our Affordable Housing, raising not only the debt but 100% of the equity. I can trust that they will do what they say they will and get things done efficiently which leaves me to get on with ensuring my projects are built on time and within the required budget. I hope to continue to work with them ongoingly.”
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