Construction Bridging Finance

Construction bridging finance is a short-term loan secured against property that fills a timing gap in the construction or development lifecycle. Unlike a standard bridging loan on an existing property, construction bridging is used for scenarios specific to building projects: site acquisition before a development loan is approved, holding a completed project while pre-sales settle, or urgent finance for a construction project that cannot wait for standard approval timelines.

Speed depends on the complexity of the security and the borrower's documentation. For clean scenarios with clear security and a defined exit, and for unique scenarios, private finance can settle within the week and we can introduce you to those options, sometimes faster. Non-bank lenders typically settle in 3 to 7 business days. The biggest delays are usually in gathering documentation: building contracts, site valuations, DA approvals, and entity documents. SFG identifies what each lender needs and manages the submission to minimise delays.

Construction bridging has several common applications: settling a development site before development finance is formally approved; bridging from practical completion to pre-sale settlements; financing residual stock where remaining units have not yet sold; urgent site acquisition where a standard development application takes too long; and bridging to a long-term hold facility where the developer wants to retain completed stock. SFG matches the lender to the specific use case.

Construction bridging terms are typically 3 to 18 months. The term is calibrated to the exit: how long it will take to complete the construction, settle the pre-sales, or arrange long-term finance. Lenders want a realistic and credible exit timeline. SFG advises on appropriate term length based on the project stage and the expected exit.

Construction bridging is typically secured by a first or second mortgage over the development site or completed property. The security value and LVR determine the loan amount. For unique scenarios, private finance can lend against vacant land, partially completed construction, and completed but unsold stock, and we can make an introduction. The LVR and rate vary by security type, lender, and borrower profile.

Yes. Site acquisition bridging is one of the most common construction bridging scenarios. A developer identifies a site and needs to settle before the development application is approved or before their development finance facility is formally in place. A bridging facility settles the purchase, holds the site during the DA and finance arrangement period, and is repaid when the development loan draws down. SFG arranges bank and non-bank bridging facilities regularly, and for unique scenarios we can introduce you to private finance options.

Residual stock finance is a bridging facility secured against completed but unsold dwellings in a development. When a development reaches practical completion but some lots or apartments remain unsold, the development lender typically requires repayment of their facility in full or on a tight timeline. A residual stock bridging loan replaces the development facility, giving the developer time to sell the remaining stock without being forced into a distressed sale. SFG arranges residual stock bridging across non-bank lenders, and for unique scenarios we can introduce you to private finance options.

The exit strategy is the most important part of a bridging loan application. Lenders need to understand and believe in how the bridge will be repaid. For construction bridging, the exit is typically one of: settlement of pre-sales, refinance to a long-term hold facility, or sale of the completed property or residual stock. A clear, credible, and realistic exit supported by evidence, such as pre-sale contracts, refinance indicatives, or comparable sale data, significantly improves approval prospects and the available loan terms.