Special Edition Market Update - Winter 2016

The special edition of HoldenCAPITAL's market update features a pieces on:

  • Current Market Status
  • Major Bank Dominance Due to No Alternative
  • The World Outside of Major Banks
  • Detailed Examples & Case Studies of Funding Options for Development Sites, Small Apartment Projects, Large Apartment Projects, Townhouse Projects, Land Subdivisions & Retail Projects
  • How does a Junior Developer get started?
  • Closing Comments
  • About HoldenCAPITAL
  • Client Testimonials
  • Recent Projects
  • HCAP Invest



Intro from our Chairman...

In my 30+ years of involvement in construction finance I have seen quite a few booms and busts and the resulting impact on the construction finance sector. Amazingly, in all that time I have seen much the same loan products, day in day out with little of the innovation many other sectors have seen. We really haven’t seen any disruptive technology impacting the landscape of our industry and there are no signs that we will. 

Construction finance, while not overly complex, does require an understanding of the risks involved. The fact that loan products have largely stayed the same probably reflects the fact that those Lenders who are prepared to take those risks understand them, just as the appetite from developers keen to do bigger and better deals, means they are always pushing the boundaries. 

What has changed in the industry is how the debt is facilitated and there is no doubt that independent specialist brokers are emerging as a force that will shake up and reshape the future of the sector. 

In 2002, only 8% of Australian home loans were written by brokers while today, 6 out of every 10 home loans are written not by the bank or lending institution involved but through an independent broker. In the commercial sector, we are witnessing a similar transition with 6% of all commercial loans being written by brokers in 2010, rising to over 38% in the past 12 months. 

When you look at the mounting pressure on banks to maintain profitability, it stands to reason that if they can get the same outcome at a lower fixed cost, they will happily adopt the more efficient model. Likewise, developers are seeing the benefit of working with specialists who have a range of products that are adaptable to their individual needs and as a result, can ensure their project gets the best deal available rather than just accepting the product their house bank sells to them.

On a daily basis our team here at HoldenCAPITAL are sharing their collective knowledge with you, our developer clients. This booklet is a way of further sharing that knowledge to help you profit more from your projects, undertake more of them and ultimately achieve it all with far less stress.