28 Apr RSP Case Study: Land Bank Property Development 2021

Case Study 2: Land Bank – Property Development

CLIENT POSITION:

Loan (limit):                    $12,250,000

Term:                                18 months

LVR:                                  55%

Enterprise:                      Land Bank for future development

Lender Type:                  Specialised Equity Property Lender

Location:                         Western Sydney

Bankability:                     Improving

Time to Settlement:      16 days

Borrower’s primary business entails offshore manufacturing and wholesale importing of goods.  Recent investment and expansion (COVID driven) into direct to customer sales via e-commerce platforms to existing retail clients and their own innovative platforms have positioned the client extremely well for future profitability at the expense of current cash flow.

Secondary business is a medium-term play of land transformation via rezoning.

An opportunity to secure strategic holdings in a growth zone of SW Sydney required immediate capital to complete the acquisition.  Projected cash flows will enable a refinance into mainstream banking but the immediate requirement for capital fell outside of banking capability.

RSP SOLUTION:

Funding covered all transaction costs (finance fees, stamp duty) plus additional working capital to meet ongoing commitments and fund business expansion.

Exist strategy clearly defined with a mainstream bank lined up to provide the “take out” finance when minimum financial hurdles are met.

Speed to market, ease of transaction execution and significantly reduced funding risk during the transitionary phase of business growth.

Ongoing support from Robinson Sewell Partners