There is a lot of detail needed to finalise an approval for development finance. Typically, this includes (but is not limited to):
Borrowing Entity Details – This is just the detail of the borrower and structure thereof.
Consultant List – This is a list of all consultants and their qualifications, including the architect, surveyor, QS, planner, lawyer, accountant etc.
Build Contract – The formal contract or form thereof, preferably unsigned, so we can make sure it is acceptable to the lender.
Detailed Feasibility – This is a detailed summary of all costs and revenues for the project.
Statement of Position – This is a snapshot of the statement of position for the sponsors of a project. It is important to gauge their ability to fund any cost overruns.
Plans – These are the plans for the development.
Resource Consent – This is written permission from the council for an activity (construction) that isn’t allowed for ‘as a right’ under the district or regional plan.
Building Consent – This is written approval provided from the council to carry out the building work specified at the site specified.
Engineering Planning Approval - This gives permission for the civil engineering works for the infrastructure (stormwater & wastewater connections) that will be vested to the council.
Building Contract – This is the contract between you and your builder for the construction of the properties in the project.
Quantity Surveyors Report (QS Report) – This is the initial report prepared by the QS, comprehensively covering all items to do with the development and highlighting any risks for the lender (and client).
Valuation – Most lenders will require a valuation on the property ‘as is’ and ‘as if complete’.
Sale and Purchase Agreement for the land – unless the land has been owned for 2+ years, the lender will often require a copy of the sale and purchase agreement for the acquisition of the land.
Pre-sale agreements – a schedule of all pre-sale contracts and a copy of the format of those contracts (preferably unsigned) to ensure that they are in an acceptable format to the lender.
While the above is not a comprehensive list as each development has different nuances, these are the key important items you need to consider before finalising your development finance.
Want more information on the development finance process? We cover the above and more in our free Development Finance Guide.
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