Case Study · Singapore

Property Developer snaps up residential property for development

30 June 2022

Property Developer snaps up residential property for development

A savvy property developer in Singapore recently made a wise investment by purchasing a residential property for development. With a keen eye for potential, the developer saw the opportunity to turn the property into a lucrative housing project, helping to meet the growing demand for homes in the city-state. Utilizing their expertise and experience, the developer is confident in their ability to bring this project to fruition, creating new homes and adding value to the local community.

  • Location: Geylang, Singapore
  • Market Value: $6,280,000
  • Loan Amount: $4,396,000
  • Loan-to-Value: 70%
  • Duration of Loan: 12 months
  • Payment Schedule: Monthly
  • Asset Type: Residential Property
  • Completion Time: 4 weeks

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FAQ

Can Rikvin Capital fund a residential acquisition for development?

Yes. Acquisition financing for property developers is a core deal type. The Geylang case here lent $4.4 million (70% loan-to-value) against a $6.28 million residential site in 4 weeks, allowing the developer to secure the site while planning approval and construction finance were arranged.

What loan-to-value is available for development site acquisition?

Up to 70% of the lower of purchase price or current market value, as in this Geylang deal. Development-site loans are usually structured as 6 to 12 months, exiting either via construction finance once approvals are in place, or via a sale to another developer if plans change.

Do I need outline planning approval before borrowing?

Not necessarily. We lend against the existing residential value of the site rather than the future development value. Once you have outline planning, you typically refinance into specialist construction or development finance, which can lend against the higher Gross Development Value.