Development financing

What is it

Development and construction financing is specifically designed to spread expenditure over the different phases of a construction project, in order to manage the financial burden on the builder or real estate developer. The goal is to gradually release the necessary funds as the project progresses, so that the costs don’t have to be paid all at once. Construction financing often includes mechanisms to manage risk for the lender, such as engaging independent inspectors to monitor project progress and confirm that financing requirements are being met. After completion of construction, the loan can sometimes be converted into investment financing.

For whom

Real estate developers, builders/contractors, real estate investors who also develop themselves.

What is the purpose

  • To finance the purchase of the land position before construction actually starts
  • To bridge the period until obtaining the irrevocable environmental permit
  • Providing the necessary capital to cover the costs of construction and development of a real estate project
  • Cost control based on a structured financial plan and budget over time

What is funded

  • Purchase of new real estate (object and/or land position)
  • Existing real estate (object and/or land position)
  • Construction and transformation costs
  • Conversion/renovation costs
  • Other development/foundation costs

In which phase

  • Purchase phase
  • Permit process
  • Construction phase

Financing partners of Novel Finance

  • Dutch and international banks
  • Specialist (international) project financiers
  • Real estate developers
  • Builders/contractors
  • Peer-to-peer & crowdfunding platforms
  • Private investment funds
  • Private investors