At Newgate Capital, we are prepared to consider funding a wide range of property related activity. We want to enable our clients to achieve their goals and contribute to a growing New Zealand economy. Some of the types of transactions we would consider are set out below. We can consider other options and can also help assist you sourcing bank debt once your transaction is in a position to be bank funded.
We find that for many developers, particularly where there is insufficient economies of scale, they want to start projects without the pre-sales a bank will require. They find that pre-sales can delay a project, can be costly to achieve and they do not get to enjoy the value uplift that can occur during the construction period.
Through our experience, we are willing to take a view on the end value and demand for developments and can fund projects without pre-sales.
This is second mortgage secured debt to rank behind bank debt. This can enable a developer to complete a project with less equity contributed by them and maximise the return on their equity.
This is where we provide one loan that is first mortgage secured but at a higher gearing level than a bank is prepared to consider. Effectively being a combination of first mortgage and mezzanine debt.
The advantage to the borrower is that they have one party to deal with, one set of legal documents and one amount of due diligence to provide. We find this can be faster, easier and a lower cost than the more traditional mezzanine debt model.
Let’s be frank, the Global Financial Crisis had a significant impact on New Zealand property developers. At Newgate Capital, we believe in second chances, and are happy to discuss your funding requirements with you.
This is a commonly used phrase but captures a wide range of loan types. Basically however, it is a short term loan that you may need while you achieve certain outcomes – this could be the sale of a property, the leasing of a vacant area or obtaining of a consent.
This is where you require funding for the holding of land while you improve it through consenting and eventual development. This can be difficult for banks where you cannot readily demonstrate servicing.
We understand that land is scarce in supply and these types of loans are critical to progress in New Zealand.
