4 Critical Factors to getting Commercial Finance Approved
Getting banks to approve commercial deals is no easy game anymore. Go back 10 years (actually, make that about 11 and a half to 12, before that dirty 3-letter word “GFC” came into existence), if a deal made sense, then just about every bank would write it. It came...
Is Government Debt Good or Bad? (and did Kevin07 destroy Howard & Costello’s outstanding economic work?)
Is ScoMo right that that it would be irresponsible to rack up more debt now, by fast-tracking infrastructure spending? And did Kevin07’s government destroy all the good economic work that Howard & Costello did, by going on a typical Labor spending-spree racking up...
RBA’s hammer finds only screws, no nails: Parliament House full of tools, none of them screwdrivers
Lowering the RBA rate is no longer going to do what traditional economic theory expects, and Philip Lowe knows it. In fact, he’s shouting it (as best he knows how) at ScoMo & Frydenberg. But ScoMo has the latest noise-cancelling headphones on, with the volume...
How Low can the AUD go?
There has been continued downward-pressure on the AUD recently, this morning sitting below 68c on what has been a consistent downward trend for about 18 months (late January 2018 was ~81c). Below is the 5 years chart for the AUD/USD (Source: OFX), which...
Site Acquisition at 65% LVR
Banks are even more increasingly uncomfortable with providing finance terms on site acquisitions that developers want or need - on large sites there's next to no appetite, on smaller sites the LVR will often be capped at 50% at best, or pulled back to around...
Bank funding $8.8m for 32 Townhouses with less than 25% Debt Cover
Being an expert ONLY in Development Finance can be like having the blinkers on, particularly if the Developer's wider Group includes other income sources. In this case, with the developer wishing to only have minimal pre-sales prior to commencing, the...
I have a Strong Relationship with my Bank
If we had a dollar for everytime we've heard this, particularly over the last 12 months... "I've been with my Bank for [insert big number here] years, I have a really strong relationship with them, my banker has always looked after me." Good for you. Unfortunately,...
In-Fill Subdivision Finance with No Pre-Sales
Small-lot in-fill subdivisions can be great little projects - getting in & out quickly with good profit margins can result in solid returns on an annualised basis (IRR, for the finance geeks!). For small projects and relatively inexperienced developers...
Townhouse Development Finance with No Pre-Sales
With projects requiring less than $10m in debt, when we present our clients with the pros & cons of Bank vs Non-Bank development finance options, it is increasingly rare for developers to choose the cheaper bank option. Why? With this project, the developer "just...
Think that a Commercial Interest Rate in the 4’s is cheap? Think Again…
In a record-low interest rate environment, if you're not aware of where the market actually is, it's very easy to think you're getting a great deal, when you're actually paying overs. Commercial Property Investment is a perfect example at the moment. Think that a rate...
Leigh Blain Joins STAC Capital
We're really excited to announce that Property Finance expert, Leigh Blain, has joined the STAC team! Leigh is a leading expert in Property Finance, with over 15 years experience in development & commercial investment, having held Senior Management roles in...
2.5% Interest Rates creating opportunities for Developers & Investors
The RBA’s announcement today saw the cash rate drop to a historical low of 1.25%. Add (subtract?!) to that, many economists are tipping another cut, which does tend to be the RBA’s norm (the previous rate cuts being May & August 2016, February & May 2015, May...
Credit Tightening & the need for Professional Debt Advice
Too often we’re seeing the goalposts getting moved when businesses and property developers/investors seek debt, as many funders have been changing their appetite. In business, you’re already juggling 100 things – can you afford to be doing 101, particularly when debt is such a high risk game these days? What opportunities are you missing out on by spending your time doing something that we’ve got the expertise and the time to do?
2 Common Major Mistakes in Business Finance
2 Common & Major Mistakes in Business Finance – (1) giving every asset as security for every loan to your bank; and (2) Not providing clear communication to your bank around the strategic direction of the business.
Opportunities & Risks in M&A
Mark recently presented on the opportunities and risks in using debt & equity for M&A (mergers & acquisitions) to grow a business. Have a flick through the slides and brief commentary…
So the Bank Declined your loan….. now what?
Often the “Declined” conversation is short and uncomfortable – after all most people hate bad news. But these events can be a rich source of information to build a better business & banking relationship…….
10 Questions your Banker Should be Asking
Do you have a good business banker? If they haven’t asked you these 10 questions, chances are you don’t have the right support on your finance team…
Smiddy Charity Ride – the brief story & pics (and WHY I did it)
As I write this now, I’m thankful for being lucky enough to be sitting in a warm and comfortable hotel room in Adelaide, injury free and off the saddle, as I think about what has just been a week of highs & lows on the Smiling for Smiddy charity fundraising ride in South Australia.
Time, Money & Missed Opportunities……
Are we there yet?”. This old chestnut from the kids in the backseat is increasingly heard from the mouths of Bank customers as they seek to navigate the paths to finance approval. This week we explain a little of why it’s taking so long to get finance & also why the finance you do get approved is likely for a shorter term…..
Tougher funding for business ahead
The Royal Commission handed down plenty of recommendations, many of which hit the headlines. But one that didn’t, relates to “small business” lending – which isn’t so small, and poses the risk of further credit tightening for businesses that nobody would call “small”.
Considering using Mezzanine Debt on your next Development, because your Equity is still tied up in the last one? There can be a better way…
With sales now taking longer to lock in and settle, property developers often have unsold stock when construction has completed, which can leave them either being unable to payout the construction debt, or having equity tied up that is needed for the next project....
3 Questions Professional Advisers should ask when completing Client Reviews
Ponder this thought for a moment:
How often does a client hand you a detailed scope of required services, clearly defining exactly what it is that they want you to consider/analyse/produce/etc.?
The Danger of having One Bank & Cross-Collateralised Securities
Loyalty used to truly mean something in banking. Aside from questioning whether the loyalty is returned, being loyal to just one bank can actually be a dangerous game to play.
STAC secures Construction Funding with favourable FIRB terms for high-rise apartment project
STAC recently had quite an impressive achievement with a funding approval that, to be frank, we expect that many people may not believe - because it's a good deal even in the good times, let alone the current funding environment. The developers of an inner-city...