65 – Using private capital to complete property developments


Manage episode 257442410 series 2419074
By Justin Gehde. Discovered by Player FM and our community — copyright is owned by the publisher, not Player FM, and audio is streamed directly from their servers. Hit the Subscribe button to track updates in Player FM, or paste the feed URL into other podcast apps.
Private capital funding was somewhat of an exotic animal a few years ago for most developers but has become quite mainstream in recent years, with more developers using it to fund their projects as bank lending has tightened. So we dig in to find out the best way to access non-bank lending. At the time of this recording, Australia is in a kind of lock down due to the corona virus so life has changed quite a bit for many of us. We are spending more time at home and there is a huge amount of uncertainty floating around. So I hope you are well, and coping as best you can. I will be bringing you some episodes about how you can use this period as an opportunity to set yourself up for growth, so keep an ear out for them in coming weeks, including a discussion with past guest Byron Sakha about leading through adversity. In the meantime, perhaps you have a bit more time to listen to podcasts, read books and work on those tasks you have been putting off for ages… Before we get to today’s guest, don’t forget we have the mentoring program available to help you get started in property developing, if you’ve always wanted to become a developer but don’t know where to start, or have fears about getting it wrong, then the program is an ideal way to learn the ropes and have someone hold your hand along the way. Email me, justin@propertydeveloperpodcast.com to find out more. Property Developer Training If you are keen to get started today in learning about the property development process and what you need to do at each step, then jump into the Property Developer Training course (www.propertydevelopertraining.com). This is the program that Justin has put together to help you get quickly started in property developing. Complete the course at your own pace and in your own time, and learn the tips, trips and techniques that Justin has used in all his projects. Find out more at www.propertydevelopertraining.com Property Developer Quiz Keen to find out how ready you might be to become a developer? Then take the Property Developer Quiz (www.propertydevelopertraining.com/quiz) and get a sense of where you are at… Speed to market can often off set the higher costs of non-bank funding. Okay, on to today’s guest, commercial finance specialist Fabian De Marco from Commercial & Construction Capital. We are talking all things private lending. With the growth in the sector over the past few years, there are many new players in the capital markets and lots of developers are turning to a source of finance that just a few years ago was more of an exotic species than mainstream. But all that has changed as lending restrictions have kicked in and banks have reduced their exposures and risk appetites. Fabian is a seasoned debt placement specialist with nineteen years of expertise in property development finance, including land and construction finance through senior debt, mezzanine debt, preferred equity and joint venture funding. Fabian also has experience in funds management, financial markets and retail banking, having held senior roles with well known banks, hedge funds and money managers. We talk about the pros and cons of private funding, some of the pitfalls to look out for and when is the best time to use private capital, which may grow even more over the coming years depending on what happens after the corona virus has passed… so you might be considering this funding avenue for your next project… we haven’t had a private capital conversation on the show before so I was looking forward to hearing about how it can work for you… Lessons for Real Estate Developers Okay, there you go, an interesting conversation about alternative ways to get your next project funded. It has been challenging getting pre sales in the past few years, but things were improving until the corona virus struck and the world changed, so now we are back in a tough environment for pre sales so private capital may become ev...

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