Apartment Development Finance

Apartment development finance covers a wide range of project scales, from boutique buildings of five to twelve units through to mid-rise developments of fifty or more apartments. Each scale requires a different lender, a different presales position, and a different approach to feasibility. Settled Funding Group works with apartment developers at every stage, from first-time developers stepping up from a townhouse project to experienced developers managing their third or fourth apartment building. Joseph Farhat reviews each project and identifies the right lender from the 90+ panel before anything is formally submitted.

Who This Is For

• •Developers building apartment projects from 5 to 50 or more units with a DA-approved design and a fixed-price builder contract.
• •Those developing boutique apartment buildings of 4 to 12 units in established locations where the per-unit price supports a smaller project count.
• •Mid-rise apartment developers in urban growth corridors targeting a mix of owner-occupier and investor buyers.
• •Developers building SOHO or mixed-use apartments with ground-floor commercial and upper-level residential.
• •Investors entering apartment development as a step up from townhouse or duplex projects and seeking a lender comfortable with their transition.
• •Experienced apartment developers seeking a new lender relationship or better terms for their next project.

How Apartment Development Finance Works

Apartment development finance is assessed on GRV and LTC, presales (typically 100% of the loan amount covered by presale contracts for major banks), DA approval, the development feasibility, QS report, construction contract, builder track record, and developer experience. Presales requirements vary significantly between lenders. Non-bank lenders often require less or no presales for smaller boutique projects, particularly in strong inner-city locations. Joseph Farhat matches each project to the right lender tier based on the project scale, presales position, and developer profile.

For an example of large-scale multi-unit development finance, see the Ashfield boarding house case study. The $10.5M no-doc private facility for a high-density residential project demonstrates that specialist lenders can fund complex, large-scale residential developments at scale when the project and exit strategy are well-structured.

What Lenders Assess for Apartment Development Finance

• •Presales position: major banks require presale contracts covering 100% of the loan amount before approval. Non-bank lenders for boutique projects may require 50% or less, or waive the presales requirement entirely for strong inner-city locations.
• •GRV and LTC: the gross realisation value on a per-unit and whole-building basis, and the loan-to-cost ratio against total development cost. These are the primary metrics for determining maximum loan exposure.
• •DA approval: the DA must be current and cover the full project scope including unit count, floor space, and any mixed-use components.
• •QS report: a quantity surveyor report is required by all institutional lenders to verify the construction cost budget and confirm project viability.
• •Builder track record: lenders for apartment projects want to see a builder who has completed comparable scale apartment projects. A builder with no apartment experience increases risk and may reduce lender appetite.
• •Developer experience: prior apartment development is preferred by major banks. Non-bank lenders are more flexible for developers stepping up from smaller projects when the other project metrics are strong.
• •Exit strategy: progressively settled apartment sales are the standard exit. Lenders also assess the residual stock risk if not all apartments sell at practical completion.

The Apartment Development Finance Process: What to Expect

1. 1.Initial review: Joseph Farhat reviews the project feasibility, presales position, DA, and developer experience to identify the right lender tier before submission.
2. 2.Application prepared with DA, QS report, presale contracts, feasibility study, builder contract, and financial documents.
3. 3.Development valuation: an independent valuer assesses the GRV on a per-unit and whole-building basis, incorporating comparable apartment sales in the area.
4. 4.Approval: typically two to six weeks from submission depending on the lender and project complexity.
5. 5.Construction drawdowns released at milestones. As individual apartments sell and settle, loan exposure is progressively reduced. Settled Funding Group can assist with exit planning including residual stock finance if any apartments remain unsold at practical completion.

Indicative Finance Options

Apartment Development Finance Broker

Apartment development finance is one of the most lender-specific products in the market. Presales thresholds, GRV and LTC limits, and developer experience requirements vary enormously between major banks, non-bank lenders, and specialist funders, and a boutique five-unit project is assessed by a completely different lender to a fifty-unit mid-rise. A broker who knows which lenders actually have appetite for your unit count, location, and presales position saves weeks of wasted applications, protects your credit file from unnecessary enquiries, and opens access to non-bank and specialist development funders that most apartment developers cannot approach directly. For projects that are complex, time-critical, or already declined, a broker knows where the deal will genuinely get done.

Settled Funding Group represents you, the developer, not the lender. Joseph Farhat reviews your feasibility, DA, presales contracts, QS report, and builder track record, then matches the project to the right lender from the 90+ panel and negotiates terms on your behalf. We prepare and manage the submission end to end, from indicative assessment through to your first construction drawdown. As a broker, we are typically paid by the lender on settlement, so in most cases there is no direct cost to you. If your apartment project is stepping up in scale or has stalled elsewhere, talk to us early and we will tell you honestly what is achievable.