100% Joint Venture Development Funding
A Joint Venture is a contractual agreement joining together two or more firms for the purpose of executing a particular business strategy with the aim of making profit and share.
At Prime Bunc , we have a network of Europe, UK and overseas investors, developers and contractors who are actively looking to engage in Joint Venture relationships. This unique solution has resulted in our investors lending 100% of the total project costs, enabling the completion and realisation of the project.
Our investors can introduce either pure equity investment into a development deal or partner a developer with another who comes with the equity. Depending on your situation we will find the right solution to suit your needs.
Joint Venture Development Funding Criteria
We can arrange 100% Joint Venture Development funding for deals in and around the Europe, UK and Overseas. In general, they must meet the following criteria:
- New development projects or refurbishment
- Full planning in place is preferred but consideration can be made for deals without planning
- Must be an experienced developer with a proven track record
- GDV minimum 2m and maximum 15m for Europe and UK projects
- GDV minimum 10m and there is no maximum for overseas projects
- Residential schemes only
- Multiple units/plots only
- Profit Margin required 25%+
- Interest rate 12% p.a. rolled up
- Profit Split usually 50:50 after interest deducted
- Personal Guarantee may be required
- Max 18 month term
Advantages of Equity Development Finance
The main advantage of Equity and Joint Venture Development funding is that the developer may not need to put any cash into a deal and could therefore develop a profitable opportunity that would otherwise not be completed.
- Where the traditional Senior Debt Lenders limit the lending to 60% of total costs, Joint Venture Development funding allows the lending to stretch to 100% including land acquisition, hard costs and soft costs
- Because the fund participates as a 100% joint venture partner, they assume nearly 100% of the project risk until completion or stabilization.
- Expert advice and invaluable experience can be provided by the equity investor
- Allows the developer to develop more projects at a time as their funds are not tied up in one particular deal.
- The developer does not need to service any interest at any stage during the project
- Typical profit share for a developer can range from 30% to 50% depending on the specific project
- Flexible structures can be designed where ratchets are included to enable the developer to maximise profits when certain sales targets are achieved
Joint Venture and Equity investment next steps
If you are a developer with a great opportunity but no cash to put into the deal then send an email to info@btrl.co.uk with the development appraisal, executive summary including previous projects and the plans.
If you are an equity investor looking to for the right development opportunity and developer then send an email to info@btrl.co.uk with the deal size, type and location that you are looking to invest in
If you own some land or a potential development project where you would like to leave the equity within the property and find a suitable partner to develop the opportunity together then send an email to info@btrl.co.uk with the property details and the background to the deal.
If you wish to speak to one of our experienced brokers, please do not hesitate to contact us
and we will be happy to assist.