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Development finance funds projects built to sell or to hold for income, and it is assessed on the numbers of the project rather than primarily on you. Lenders test the feasibility: what the finished development will realise, what it costs to build, how much of it is presold, and whether the margin survives if either side of that moves. Two developers with the same site can get very different terms depending on how the feasibility is presented and which lender it goes to. Joseph Farhat and his team will tell you honestly and quickly what is achievable for your project.
Who we can help access finance
- •Developers building townhouses, duplexes, and small unit projects for sale.
- •Investors building multi-dwelling projects to hold and refinance to a long-term facility on completion.
- •Developers of purpose-built boarding houses and rooming accommodation under state boarding house legislation.
- •Those converting an existing commercial or residential building under a DA-approved change of use.
- •Developers with a DA in hand who need site acquisition and construction funded together.
- •Projects with reduced or nil presales, where the lender panel narrows to those who assess on feasibility rather than presale cover.
- •Developers whose existing facility has stalled mid-project and needs refinancing to reach completion.
- •Self-employed developers whose income does not present neatly but whose project numbers are strong.
How Development Finance Works
The lender sizes the facility against two measures. Loan to cost, or LTC, is the advance as a share of total development cost including land, construction, and soft costs. Loan to gross realisation value, or GRV, is the advance against what the completed project is expected to sell for. Banks generally sit around 70% LTC and 60% GRV and want presales covering a meaningful share of the debt. Non-bank lenders go higher on both and are far more flexible on presales, at a higher rate. Funds are released in progress draws against QS certification, interest is usually capitalised into the facility, and the loan is repaid from sales or a refinance on completion. Joseph Farhat and his team review the feasibility, the DA, and the builder, match the project to the right lender from the 90+ panel, and manage the application through to practical completion.
What Lenders Assess for Development Finance
- •Feasibility: the project margin on total development cost. A thin margin leaves no room for a variation or a softening market, and lenders test it accordingly.
- •GRV evidence: independent valuation supported by genuine comparable sales, not the developer’s expectation. This is the number most often revised down.
- •Presales: how much of the debt is covered by unconditional contracts. Banks usually want substantial cover. Several non-bank lenders will consider reduced or nil presales at a lower LVR.
- •DA approval and conditions: the DA must match what is being built, and any conditions affecting staging, contributions, or timing need to be understood before funding.
- •Builder and contract: a licensed builder with relevant project experience and a fixed price contract is the strongest position. A QS report is generally required.
- •Developer experience: prior completed projects of similar scale carry real weight, particularly where presales are reduced.
- •Exit: sale of the completed stock, or a refinance to a long-term facility if the project is being held. The lender needs the exit to be credible on the timeline.
- •Specialist use classes: boarding houses, childcare, and similar assets are assessed on their income model as a going concern, and only some lenders have appetite.
Boarding House and Rooming Accommodation Projects
Boarding house development sits in specialist commercial-residential territory. Most standard development lenders have no boarding house appetite, and those that do assess the project on the per-room income model as a going concern rather than on a straightforward residential GRV. Compliance with the relevant state boarding house legislation, including the Boarding Houses Act 2012 in New South Wales, is the first thing a lender checks, and missing or ambiguous compliance documentation is the most common reason these applications are declined. The DA must approve the boarding house use and specify the room count, common facilities, and any management conditions. Builder experience with kitchenettes, en-suites, and fire separation requirements is assessed closely. Joseph Farhat and his team identify the lenders on the panel with genuine boarding house experience before any application is submitted.
A direct example of what is achievable is the Ashfield boarding house case study, a $10.5M no-doc private facility for a 30-room boarding house in Ashfield, New South Wales. It shows that large-scale boarding house projects can be funded by the right specialist lender, even without standard income documentation.
The Development Finance Process: What to Expect
- 1.Talk to Joseph Farhat and his team about the site, the DA, and the feasibility. You will get an honest read on what is fundable, including if the numbers do not support the project as structured.
- 2.Provide the basics: the feasibility and cost plan, the DA and plans, the builder contract and licence, a QS report, any presale contracts, and your own financials or bank statements.
- 3.We match the project to the lenders on the panel most likely to fund it at the LTC and GRV you need. Presale requirements and use-class appetite vary enormously, so this step decides the outcome.
- 4.The lender orders an independent valuation and QS review and issues an approval setting out LTC, GRV, rate, drawdown schedule, and conditions. We go through it with you before you sign anything.
- 5.Site settles if required, construction begins, and progress draws are released against QS certification through to practical completion, then sales settle or the project refinances to a long-term facility.
Indicative Finance Options
| Lender Type | Indicative Rate | Max LTC | Max GRV | Typical Loan Range | Key Consideration |
|---|---|---|---|---|---|
| Bank | From ~7% p.a. | 70% LTC | 60% GRV | $1M to $20M | Substantial presale cover and full financials usually required |
| Non-Bank Lenders | From ~8.5% p.a. | 80% LTC | 65% GRV | $500K to $20M | Reduced or nil presales considered; alt-doc options; specialist use classes |
| Private Finance | From ~10% p.a. | 85% LTC | 70% GRV | $1M to $20M | Available for unique scenarios |
Indicative figures only. Actual rates and terms depend on your project, financial position, property location, and lender assessment at the time of application. Rates are subject to change.
Why borrowers choose Settled With Joe for development finance
- •We represent you, not the lender: Joseph Farhat and his team act in your interest from the first conversation through to practical completion.
- •Presale policy decides most deals: the gap between a lender wanting substantial presale cover and one assessing on feasibility alone can be the difference between proceeding this quarter and next year.
- •Feasibility presentation matters: the same project put to a lender properly, with a defensible GRV and a real contingency, gets a materially different answer.
- •Specialist use classes need specialist lenders: boarding houses, childcare, and similar assets are funded by a small group of lenders, and we know who they are.
- •We will tell you if the numbers do not work: a project that cannot carry its own feasibility is not one we will push into an application.
- •One conversation, not five applications: development enquiries take time to assess, and each decline costs you weeks inside a DA or option period.
- •90+ lenders on one panel: bank, non-bank, and specialist, so a presold project with full financials can go to a bank at a sharper rate and a nil-presale project still has options.
- •Private finance for unique scenarios: where bank and non-bank lenders are not the right fit, we can introduce you to private finance options.
- •Usually no direct cost to you: as a broker we are typically paid by the lender on settlement.
- •An honest answer early: if you are working to a site settlement or an option expiry, talk to us first and we will tell you what is realistically achievable.
