In the Australian Financial Review today, “Westpac has stopped lending to SMSFs wanting to buy property in response to growing credit and market risks, regulatory pressure and funding costs” and we are happy to confirm Prudential Finance has SMSF finance available through our investors and private lenders.
Self Managed Super Funds Funding
Call 1300 550 669 or complete to online form at the bottom of this page to discuss your SMSF funding requirements.
Prudential Finance has provided professional finance services for over 16 years and we look forward to hearing from you about your SMSF loan needs.
Once we have solved your SMSF funding, you may be interested in viewing our property investment video click here
Interest rates start from 7.75% per annum and we can lend up to 70% of the property valuation (terms & conditions apply).
Multiple Funding Channels for Property Developers are Imperative
The vast majority of developers we help obtain Construction and or Development Finance tend to focus only on private funding solutions as it has been a reliable way to efficiently source funding.
We are seeing an increasing number of new clients who have historically relied upon bank funding who are now migrating over to non-bank lending. Its no surprise that bank funding has become increasing difficult due to pressure from regulators which is heavy publicised and hence a shift to private funding.
I think its important to have a mixture of both bank and non-bank funding channels/relationships in place at all times. This is a common conversation we have with new and existing clients.
There are several pros and cons of bank and private funding such as interest rate, timeframe, pre-sales, LVR differentials etc, etc but to me no matter what cycle we are in, building robust relationships and having multiple options with both Bank and Private Funding will be paramount to developers who have or are working on building a healthy pipeline.
What I do know, is the landscape is continually changing and either you adapt or you fall behind as the future is unknown. Most developers may already have coverage from both sides but we continue to hear otherwise and wanted to reiterate our view in event we can help someone who may be thinking about this.
“Prudential Finance does not provide financial product advice and does not hold an Australian Financial Services Licence. Prudential Finance recommends that investors consider their own objectives, financial situation and needs before proceeding with any investment and seek professional advice. All information contained within this Website is specifically structured for corporate, business, commercial, construction clients, wholesale and professional investors.”
Prudential Finance short term funding – property loans, are classed as asset lend loans, where the real estate value is the key factor in raising the loan.
Prudential Finance are Short Term Funding specialists for Property Loans.
No matter whether you have many credit defaults or are in Administration, Receivership or Liquidation. Prudential Finance may be able to provide you with short term funding to payout all debts and enable you to refinance with another lender.
Lately I have heard some very interesting definitions of what “Mezzanine Finance” means.
To clear up the actual meaning; “Mezzanine Finance” is subordinated debt with ranks behind a 1st mortgage/senior debt.
Mezzanine Finance will usually be secured by a 2nd Mortgage.
I have seen other definitions where they say Mezzanine Finance “gives the lender the rights to convert to an ownership or equity interest in the company if the loan is not paid back in time and in full”. This is incorrect. A mezzanine lender may or may not include rights to takeover the project in the event of default although it is certainly not the definition of “Mezzanine Finance”.
Therefore “Mezzanine Finance” is subordinated debt which ranks behind 1st mortgage/senior debt and ranks before preferred equity and equity. The terms can vary from lender to lender.
This was posted on Facebook by BRW. Very interesting reading!
Published 08 July 2014 10:53, Updated 08 July 2014 10:54
Source: Alexis Knight
If one or more of the following scenarios apply to your startup, you need to change them quickly or go back to the drawing board.
THE PRODUCT YOU’RE LAUNCHING HASN’T CHANGED FROM YOUR INITIAL IDEA
If you are launching a product that you sketched out on the back of a napkin and you haven’t deviated from your original idea, then you’re in trouble. It means that you haven’t listened to your market. It is very rare (I’d even say impossible) that someone will have an idea that has product/market fit from day one. Every company has to have a period where its soul aim is to find what that product/market fit is and you need to be obsessive until you get there. This can involve anything from rewriting your product, changing your team, moving into a different market, or saying yes to opportunities you had never considered.
THE ONLY FUNDING YOU’VE ATTRACTED IS FROM FAMILY AND FRIENDS
This might sound contentious, but the reality is if the only funding you can attract is from family and friends, then signs are not great. Sure, they know you well and believe in you, but unless they have direct experience in the industry you’re targeting, then you have nothing but fools’ money. Even at the angel stage you need to try and attract money that you have had to earn, money that validates both you (investors invest in people) and your idea. Early stage funding is not that hard to come by these days (if the people and idea are solid), if you’re not attracting that, then you need to think long and hard about what this might indicate.
YOU DON’T HAVE A CO-FOUNDER
Solo founders are weak founders. Your co-founder doesn’t have to be a tech person if you’re not one and vice versa, but you need a tight team with a solid vision, and skills that compliment each other. Finding the right founder is something that needs time and patience, but a strong team will beat a solopreneur any day. Paul Graham is well-known for famously listing the solo founder as one of the biggest mistakes a startup can make. A startup is simply too much work for one person
YOU’RE PURSUING MULTIPLE MARKETS AT THE SAME TIME
Small teams, on small budgets, need to focus. If you’re pursuing all your options at once then you are spreading yourself too thin and you will fail. You need to find a focus and nail it before you move on to other markets. If you’re having trouble getting traction in one area, fail fast and move on. But if you are focusing on one thing at a time, then when you find the right product/market fit you have a much better chance at success than if you were trying to establish other markets along with it.
YOUR MONETISATION ONLY KICKS IN AT SCALE
If the only way your BIG idea works is at scale, then … you’re stuffed. This is the easiest way to set a startup for failure from day one. Don’t do it. It makes your job twice as hard as it already is.
YOU HAVE NO DISTRIBUTION STRATEGY
So let’s say you have a great product, you have product/market fit and you have a fantastic co-founder. How are you going to get your “world-changing” product out there? Your distribution strategy has to be part of the product from day one. How many times do founders have to say that they failed because they “never got traction” before we wake up to the fact that their failure was a simple one: they had no distribution strategy. How are people going to find your product? If your answer is advertising, then consider it GAME OVER already. How people find your product is part of your product, social sharing should be a key part of that strategy.
YOUR PRODUCT IS NOT SOFTWARE DRIVEN (OR HAS NO PLANS TO BECOME SOFTWARE DRIVEN)
Innovation is accelerating and software is the reason. In the words of Marc Andreessen: “… the minute you can take something that was not software and make it software, you can change it much faster in the future. It’s much easier to change software than it is to change something with a big, physical, real-world footprint.”
You might not be software driven from day one (hell, it’s better if your minimum viable product is NOT) but that needs to be a temporary state.
Software implies one thing; that innovation is a driver. Remember in the future all companies will be technology companies.
*Alexis Knight (not her real name) has extensive startup experience in both running a startup, and working for an investment firm. This article originally appeared on pollenizer.com.
Rich foreigners with the equivalent of $405 million investment applications for visas were approved in April and May.
The “golden ticket” visas were issued to eighty-one successful applicants, the most issued since the program started in late 2012. Of those, eighty-five per cent were issued to Chinese nationals. So far, 255 visas have been issued by the Department of Immigration and Border Protection worth $1.28 billion sine the launch of the program.
To be eligible for the program, foreigners must invest a minimum of $5 million in government bonds, Australian proprietary companies or ASIC-regulated managed funds. The visa allows the receiver and their family to migrate to Australia and after four years they can apply for permanent residency.
Compared to other migrant visas the recipient has no age limit or standard English language proficiency requirements. Majority of the visas have been issued to people investing in NSW and Victoria schemes.
The NSW government’s Waratah Bond program is among those to have seen an uptick in investment. $1.5 million is the minimum investment over a four year, fixed rate with foreigners apply to be part of the program granted they have obtained a NSW government sponsorship.
Chief executive of ASX-listed Centuria’s, Jason Huljich says, “The vast majority of money is going into bonds. Investors want to put their money into something they believe will 100 per cent preserve their capital base. They don’t care that much about low returns”.
There has been a significant growth in interest in the visa program since the cancellation of long-running Canada’s immigrant investor program. It was cancelled in February with a waiting list of 59,000 people.
Michael Burstin of Oliver Hume Funds Management said “We now have over $30 million committed to our fund and expect a further $20 million once current visa applications are approved later this year.”
Bonds are considered an easy alternative for investors who are either unwilling or unable to identify worthwhile private funds to invest in.
Technology has become prominent as the new force for wealth creation in Australia. The BRW Young Rich List, filled with technology savvy entrepreneurs aged 40 and under are now becoming the new faces of BRW Rich 200 List, which requires a wealth of at least $250million. Matt Barrie (Freelancer), Ruslan Kogan (Kogan) and Owen Kerr all made their fortunes through technology, with Atlassian co-founders Mike Cannon-Brookes and Scott Farquhar becoming billionaires.
Recently Freelancer.com chief executive Matt Barrie wrote to Communications Minister Malcolm Turnbull, “We are at the start of the biggest technology boom in the history of mankind – Australia is completely missing the boat.”
Mr Barrie says Australia is the second most expensive country for start-ups because of high wages and rent. Entrepreneurs also argue the policies hold them back and there are concerns due to the decline of students studying Science, Technology, Engineering and Mathematics (STEM) with a fall of 60 per cent in enrolments in computer science over the past decade.
On top of this, the start-up community is frustrated the May budget did not fix the restrictions on employee share option schemes, which makes it twice as difficult for entrepreneurs to recruit for their companies, therefore many outsource to Asia or hire foreign staff on 457 visas.
Australian start-ups struggle to find local funding once they reach a certain size, with most of the big capital raisings in the technology sector coming from outside Australia. Mr Barrie described the venture capital sector as “stillborn”. There is a growing pool of money for early-stage companies with many successful entrepreneurs investing into start-ups such as Seek founders Andrew and Paul Bassat through Oxygen Ventures and Markus Kahlbetzer (son of BRW Rich List veteran John Kahlbetzer who set up Tank Stream Ventures.
A spokesman for Mr Turnbull said he had received Mr Barrie’s email and the government would release its innovation policy later this year.