HIGH-DENSITY, MIXED-USE CONSTRUCTION

A firm of architects happened across a thin slither of land being divested by NSW State Rail.

Zoned “5 (b) Special Uses (Railway)”, it provided no real economic use but had unrestricted FSR.

A speculative acquisition, the purchaser's bank could not provide finance, providing the opportunity for a good example of how LINK can finance from acquisition, development, through to construction, with end user finance as well as residual investment finance.

The Problem

The property was purchased as vacant, non-income producing land, irregular shaped being narrow and abutting railway lines to the rear, with unfavourable zoning and no economic use.

The developer struggled to complete the purchase; its own bank would not advance funds on security of the land as there was no prospect of generating rent with which to service a loan.

The LINK Solution

After lengthy consultations with the developer, market research, and interviews with commercial

valuation firms, LINK built a case for raising funds to complete the purchase while the purchaser went to work designing a project for a development application to Council.

A forward-thinking non bank financial institution was presented LINK’s credit memorandum which identified and provided analysis for various scenarios and outcomes. With a long-term view to funding, a single senior-debt facility was negotiated at surprisingly favourable terms.

The End Result

After 14 months and several applications to Council, development consent was granted for a high-density, dual-tower 90 unit complex over a two-storey 1,466m2 commercial/retail podium above 5 basement levels with anchoring on NSW State Rail land.

LINK fully funded construction of the ‘gateway’ project while recognizing the substantial up-lift in land value, assisted several purchasers with end-user finance, and arranged long-term investment finance for the entire commercial-retail space retained by the developer.