Specialist Finance for Property Developers in Brisbane, Gold Coast & Northern NSW
Land subdivision is a complex process that requires the right expertise and financial backing. Whether you’re a developer looking to subdivide a single lot into multiple titles or undertaking a larger-scale residential land subdivision, securing the right funding is crucial.
At Assured Management, we specialise in land subdivision loans, providing tailored funding solutions for property developers in South East Queensland. Contact us and speak directly to the loans approval team on (07) 5578 6177 or submit an enquiry online.
What is a Land Subdivision Loan?
A land subdivision loan is a specialised type of development finance designed to fund the costs associated with subdividing a parcel of land. These costs may include site acquisition, civil works, infrastructure, and council contributions. As a niche area of property development finance, subdivision loans require expert structuring to align with project timelines, development milestones, and cash flow requirements.
At Assured Management, we understand the challenges property developers face when securing funding for a subdivision project. We work closely with our clients to provide finance solutions that accommodate the unique requirements of each project.
Subdivision Finance from a Non-Bank Lender
Assured Management is a non-bank lender with the flexibility and capacity to work directly with property developers to finish subdivision projects in a timely and cost-effective manner.
Whether you're subdividing a single residential property into two separate titles or rezoning a large property into many separate lots, we can help when traditional banks and major lenders can't.
There is a slather of benefits to working with a non-bank lender such as:
- Non-bank lenders offer more adaptable loan terms than traditional banks.
- Get quicker access to funds to start your project sooner.
- Cover costs of buying, rezoning, and subdividing land without needing large upfront capital.
- Access funding for larger projects you couldn’t afford outright.
- Tailored loan terms that fit the specific needs of your project.
- Finance projects in stages, making it easier to manage cash flow.
- Work on multiple projects at once and grow your portfolio faster.
Different ways of subdividing land
As an investor, you need to be aware of the subdivision options that you have available.
The two most common ways to subdivide is through strata or second property.
Strata title
Convert a single title into multiple. A strata title allows you to split up. This increases the value of the land as it provides an opportunity to sell each block individually.
Second property/ dual occupancy
This subdivision includes dividing up a large existing block of land into two, or more, sections and constructing a new dwelling on a vacant lot of land.
Why Subdivide?
Subdivision is an effective way to release equity and increase profits on a property investment. This involves splitting a tract of land into two or more lots and then registering the new lots.
Once you've completed a subdivision and registered the new lots, you could potentially:
- Hold the lots so you can wait for an upswing in the market.
- Develop the lots by adding properties.
- Sell some of the lots for extra capital or to reduce your total debt.
Having your subdivision finance organised is essential to a successful development.
Key Considerations for Land Subdivision Loans
When applying for a land subdivision loan, lenders assess several key factors.
Project feasibility is crucial, requiring a well-documented study that demonstrates demand, pricing, and profitability. Development approvals must be in place to ensure compliance with council zoning and regulations.
Lenders also consider the developer’s experience and track record in land subdivisions. Pre-sales or pre-leasing agreements that indicate buyer or investor interest can also strengthen an application.
About Assured Management Limited
Assured Management Limited (AML) is a boutique funds manager specialising in first mortgage construction and development finance in South East Queensland and Northern New South Wales. Expand on the areas below to learn more about our company and our lending process.
AML's ability to work directly on a personalised level with developers is what sets it apart from competitors. Direct access to the people who are approving and monitoring your loans assures you as the borrower. This creates a proactive line of communication that puts AML in a good position should any intervention or involvement become necessary.
AML is not a bank and doesn't purport to be one; unlike traditional financial institutions they have a dynamic and commercial mindset with the flexibility and capacity to problem solve and work closely with our developers to reach the shared objective; to finish projects in a timely and cost-effective manner.
View our recent projects
Our two Directors have been involved in the mortgage funds management business since the early 1990s and one of those Directors has been involved in the mortgage industry generally since 1978. In total, all Directors have a combined industry experience over 70 years.
This experience has been instrumental in maintaining high performance and the continuing prosperity of the Assured Mortgage Fund, even through difficult economic times. Assured Management Limited has always maintained a focus on the markets in which its investments are being placed and will continue to do so in the future.
More about Key Personnel
AML lends to 65% Loan to Valuation Ratio (LVR). This applies to both the 'As Is' valuation and the 'Gross Realisation' (Including GST); at all times the aim is to hold the cost to complete in our facility. In some instances where this leaves the developer a little short, a facility can be organised to use the developer's GST refunds. By utilising this method, the developer can add the GST refunds to our loan facility to assist in funding the cost to complete.
As we lend on Gross Realisable Value (GRV), we have no limit on Total Development Cost (TDC), in some circumstances, we can fund up to 100%. In comparison to the more traditional hard-cost method of funding, this means that Developers can secure funding with significantly smaller equity contributions and get started on projects sooner.
Although upfront costs of non-bank finance may look more expensive at face value, the overall equity outlay required from Developers may be significantly less compared to traditional or bank funding. An example of this point is provided below.
| | ‘Traditional Hard Cost Method’ – 80% of TDC | ‘Assured Management Facility’ – 65% of GRV |
|---|
| ‘As Is' Land Value |
$2,000,000.00 |
$2,000,000.00 |
| Gross Realisable Value of project |
$10,000,000.00 |
$10,000,000.00 |
| Construction Cost |
$5,000,000.00 |
$5,000,000.00 |
| Interest and Fees |
$400,000.00 |
$530,000.00 |
| Total Costs |
$5,400,000.00 |
$5,530,000.00 |
| |
|
|
| Loan Available at Commencement |
$1,100,000.00 |
$970,000.00 |
| Total Loan Available |
$4,000,000.00 |
$6,500,000.00 |
| |
|
|
| Developer Equity Required |
$2,500,000.00 |
$ |
We do not have regimented requirement for pre-sales and the majority of our lending is on a no pre-sale basis. Whilst having these sales certainly can assist in the approval process, we are of the opinion that they are not the 'be-all and end-all'.
Our approach to every new development project is more holistic. We assess a loan application on the merit of the property and proposed development. This is because presales are time consuming, expensive, sometimes complex, and reduce profitability as a developer will often have to discount the product to achieve an 'off the plan sale'. By allowing construction to get underway with nil or little presales, borrowers can immensely reduce holding costs, and more often than not, achieve better end sale prices.
We do not underestimate the importance of a prospective purchaser being able to physically walk through or view the final, finished product. Combined with our personalised, professional and timely service delivery, we have borrowers that complete double the number of projects within the same timeframe that they could complete a single project with traditional bank finance.
AML has been operating for over 20 years with a strong, loyal investor base at its core. As a contributory fund, investors are 'locked in' for the life of the mortgage, unlike a 'pooled fund'. This means investors can't simply redeem their funds within a specified timeframe and potentially cause a 'run on funds' in times of economic downturn.
Accordingly, with the fund managed by experienced Directors, you can have the surety that funds will not only be available for the initial settlement advance, but also for progress draws throughout the life of your loan.
Our development and construction loans range from $1,000,000.00 to $20,000,000.00 with a maximum loan term of 18 months.
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AML prides itself in offering transparent and competitive pricing without the hidden costs of many competitors.
For more info, call us free now 1800 028 885.
Fees and interest charged to the Borrower:
1. An application fee of 2% (GST Free)
2. Interest of 11.25% p.a.
3. Release Fee/ Consent Fee of $525 for each release of mortgage or consent.
4. The Borrower will also need to pay for valuation fees, quality surveyor fees, and any other outlays.
Fees that are not charged to the Borrower:
1. Legal fees for preparation of mortgage documents.
2. Draw down fees.
3. Management fees.
4. Line fees
5. Fees for drawing on variations.
6. Monthly monitoring fees.
Why Choose Assured Management for Land Subdivision Finance?
1. Specialist Expertise in Land Subdivision Lending
Subdivision development projects come with unique financial challenges, from staged funding requirements to pre-sales conditions and council approvals. Our team has deep expertise in structuring finance solutions to support smooth project execution and profitability.
Our in-depth knowledge of the subdivision process allows us to offer guidance on feasibility, funding stages, and risk management, ensuring your project stays on track and within budget.
2. Tailored Funding Solutions
We understand that no two projects are the same. Whether you need funding for site acquisition, infrastructure development, or refinancing an existing loan, we offer flexible options to suit your needs. Our loan structures can accommodate:
- Small and large-scale subdivisions
- Residential and commercial land subdivision
- Funding for civil works, roads, and essential services
Additionally, we can structure loans with staged drawdowns to align with the progress of your development, helping you optimise cash flow and reduce financial strain.
3. Fast & Flexible Approval Process
Traditional banks often have rigid lending criteria when it comes to property development loans, leading to delays or rejected applications. We work with a network of private lenders and non-bank institutions, allowing us to secure funding with greater flexibility and efficiency. Our streamlined approval process ensures that you can access the funds you need without unnecessary delays.
We recognise the importance of securing funding quickly in a competitive property market. Our team prioritises fast turnaround times and hassle-free application processes, enabling you to focus on the successful completion of your project.
4. Competitive Loan Terms
We negotiate competitive interest rates, loan terms, and repayment structures to align with your project’s cash flow and exit strategy. Whether you’re planning to sell subdivided lots or retain them for future development, we tailor finance solutions to match your business objectives.
Contact Assured Management
Navigating land subdivision finance requires specialist knowledge and the right lending partners. At Assured Management, we provide tailored lending solutions that give developers the financial confidence to bring their projects to life.
If you’re looking for a land subdivision loan in Brisbane, the Gold Coast, or Northern NSW, contact our team today for a consultation. We’ll help you structure the right finance package to ensure your project’s success.
Enquire Now and take the next step towards securing your land subdivision finance. Contact AML and speak directly to the loans approval team.
Phone: (07) 5578 6177
Email: enquiries@assuredm.com.au