Joint Venture Development Finance

Joint venture development is one of the most effective ways to combine complementary strengths: a landowner brings the site, a developer brings the expertise, a capital partner brings the equity. But combining these parties into a finance structure that lenders will accept is where most JV projects hit their first obstacle. Joint venture development finance requires lenders who understand multi-party structures, JV agreements, and how to assess combined developer experience and financial strength. Settled Funding Group arranges JV development finance through specialist lenders, and for unique scenarios we can introduce you to private finance options.

Who This Is For

• •Landowners who want to partner with an experienced developer to develop their site rather than sell it outright
• •Developers partnering with an equity investor who owns the land and will contribute it as their equity share in the JV
• •Experienced developers collaborating with a capital partner on a larger project that exceeds their individual borrowing capacity
• •Those combining development expertise with a financial partner who contributes equity capital in exchange for a profit share
• •Joint venture parties who need a structured finance facility that recognises each party's contribution and assigns security correctly
• •Developers and builders entering a profit-share arrangement on a residential or commercial project where neither party individually qualifies for the full development facility

How Joint Venture Development Finance Works

JV development finance is assessed on the project first, then on the combined strength of the JV parties. The lender will not simply add the financial positions of the JV partners; they assess the JV agreement, the experience of each party, the project feasibility, the DA, and the exit. Joseph Farhat identifies lenders on the 90+ panel who are experienced with JV development structures, and can advise on appropriate structures before the JV agreement is finalised so that the finance application is structured correctly from the start. Getting the JV agreement right before going to lenders saves significant time.

What Lenders Assess for Joint Venture Development Finance

• •JV agreement quality: lenders require a formal, legally prepared JV agreement that clearly defines each party's contribution, decision-making authority, profit sharing, and exit provisions. Informal or loosely drafted JV agreements are the most common reason JV finance applications are delayed.
• •Project feasibility: the lender assesses the development on the same basis as any development finance application: DA status, GRV, LTC, QS report, and build plan. The JV structure does not change this assessment.
• •Combined developer experience and financial strength: lenders assess the experience and financial position of each JV party together. A JV that combines strong developer experience with strong financial backing is assessed more favourably than either party alone.
• •Security structure: the loan is typically secured over the project site. The JV agreement must be consistent with the security structure the lender requires, including who can provide the security and on what terms.
• •Presales position: for larger JV projects, lenders may require a presales threshold before formal approval. The presales requirement depends on the project size, location, and the lender's policy.
• •Exit strategy: the proceeds from project sales are distributed to the JV parties per the agreement. Lenders assess the clarity of the exit and whether the proceeds waterfall makes sense for the loan to be repaid in full.

The Joint Venture Development Finance Process: What to Expect

1. 1.Initial review of the JV structure and project: Joseph Farhat reviews the proposed JV structure, each party's role and contribution, the project site and DA status, and the overall feasibility. This gives an early read on which lenders are appropriate and whether the JV agreement as drafted will satisfy lender requirements.
2. 2.Lender identification: Settled Funding Group identifies lenders on the panel who are experienced with JV development structures and whose policy fits the project size, type, and location.
3. 3.Application preparation: a complete application is prepared including the JV agreement, feasibility study, DA or planning evidence, QS report, combined financials for all JV parties, and title documents. The application is structured to address each lender's specific assessment criteria for JV structures.
4. 4.Independent valuation: the lender orders an independent development valuation covering the GRV, the as-is land value, and the LTC assessment.
5. 5.Approval and construction drawdowns: once approved, the development facility is established and construction drawdowns are made at agreed milestones, confirmed by an independent quantity surveyor.
6. 6.Exit and distribution: as the project is completed and dwellings are sold, the loan is repaid from proceeds, with the balance distributed to the JV parties per the agreement.

Indicative Finance Options

Joint Venture Development Finance Broker

Joint venture development hits its first obstacle at the finance structure. Combining a landowner, a developer, and a capital partner into a structure lenders will accept requires funders who genuinely understand multi-party arrangements, JV agreements, and how to assess combined developer experience and financial strength. Most lenders do not, and a borrower approaching them directly often finds the structure stalls the application. A broker who knows which lenders are comfortable with JV structures saves wasted applications, protects each party credit file from needless enquiries, and reaches non-bank and specialist funders most JV partners cannot approach directly. For complex multi-party deals, a broker knows where the project will actually get funded.

Settled Funding Group represents you, the JV parties, not the lender. Joseph Farhat reviews the JV agreement, the combined developer experience, the equity contributions, and the project feasibility, then matches the structure to the right lender from the 90+ panel and negotiates terms on your behalf. We prepare and manage the submission end to end, and for unique scenarios we can introduce you to private finance options. As a broker, we are typically paid by the lender on settlement, so in most cases there is no direct cost to you. If you are structuring a JV development, talk to us early and we will tell you honestly what is achievable.