Our client purchased a recently completed a commercial property for $8.6M in the Lower North Shore of Sydney utilising a property trust structure as the purchaser.

Full Financials were available and a strong asset position was evident.

Their objective was to fix their rate to guarantee costs in this unstable market for a minimum of 3 years and of course obtain the most competitive pricing available in the current market.

Solution
GCC facilitated an approval for a 3 year fixed product sourced through a major institution at the 3 year swap rate + 1.70% margin.

 

Amount: $6,020,000
LVR: 70%
Rate: 3 yr swap + 1.70%

Funding was sought to repay an existing mortgage over 16 Strata Titled commercial offices within a five level modern commercial complex located in the Gold Coast. Our clients are a major group of chartered accountants.

The properties were purchased in Oct 2005 as a brand new (strata titled) building and the Chartered Accountancy practice moved into the building in Apr 2006. Our client occupies the fourth floor of the building and approx one third of the third floor. The balance of the third floor, the second floor and the first floor are all occupied by tenants.

Our clients required 75% LVR to repay their existing lender and to provide some additional working capital. The clients approached several banks that they had a strong relationship with however the best they could achieve was 65% P&I which did not meet their requirements. They decided to look for a second mortgage that could take the LVR to 75%. Through industry contacts GCC was approached to find a solution.

Solution
GCC was able to facilitate an approval of 75% LVR through a second tier bank on a senior debt which exceeded their expectations.

 

Amount: $6,320,500
LVR: 75%
Rate: 5.65% pa (BB + 3.00%)

Our clients entered into a contract to purchase 2 commercial units in South Yarra Melbourne. The commercial units have a 12 month rental guarantee from the vendor however as settlement was fast approaching they tried to have the units leased but were unable to do so.

The clients broker tried settling the deal with several banks however was unable to obtain approval as no lender that they approached would accept the rental guarantee and would only consider the proposal if tenants were secured. Both borrowers have a strong employment position.

Solution
GCC approached a non-bank lender and achieved an approval of 70% LVR which was higher than the 65% LVR the clients originally requested.

 

Amount: $724,500
LVR: 70%
Rate: 6.70%

Our clients own an office complex in the Perth CBD and two additional commercial properties in suburban Perth.

Their current facility was originally placed by GCC with a superannuation fund lender and due to global financial crisis the existing lender was unable and unwilling to roll the facility over.

Solution
GCC approached a new lender and based on the clients existing loan history and current financial position a new facility is being negotiated.

 

Amount: $12,500,000
LVR: 70%
Rate: 4.90% (90 Day BBSW + 2.25%)

Our borrower was seeking to utilise equity in a commercial property in Adelaide to assist with the purchase of an investment residential unit. There was a requirement that the funding was to be secured on a stand-alone basis solely against the commercial property. The borrowers existing bankers were not prepared to accede to this request and settlement of the unit was imminent. Full financial statements were provided to support the transaction however in view of the cash out nature of the borrowing it was necessary to fund through a private lender. The funding requirements were to repay the existing facility of $1.2M and additional funding of $425K provided towards the unit purchase.

Solution
GCC facilitated an approval through a private non-bank lender secured solely against the commercial property which enabled the unit purchase to proceed.

 

Amount: $1,625,000
LVR: 65%
Rate: 6.15% (90 Day BBSW + 3.50%)

Our client had agreed to purchase a block of 16 units for $1.8M from a vendor who was about to go into receivership in a large rural Central NSW town at a significant discount from its true value. Our client had seen the value of purchasing the property and converting it from single title to individual strata titled residencies.

Our introducing broker submitted the transaction to several banks however was unsuccessful as the borrower required an LVR of 70% based value and the banks were only willing to lend based on the lower purchase price. Location of the property also posed a significant hindrance.

Solution
GCC was successful in securing a facility from a private non-bank lender funding who would lend 70% of the property value in a semi rural location and take into account the full potential rental income.

 

Amount: $1,170,000
LVR: 70%
Rate: 8.25%

The client, an owner occupier, needed to repay an existing bank facility. The clients business being an international training college on the premises and was soon to enter into a formal contract to train future staff for one of Australia’s largest retailers. The client needed the funds to expand the business.

The property is ideally situated on a Main Road in the Gold Coast and as such was a prime development site. The funder who our clients were dealing with refused to accept the value add of the property as a potential development site and insisted on valuing the property as purely a commercial property. Note the client also had outstanding defaults.

Solution
A new valuation was instructed on the “highest and best use” value. A mixed use retail and residential development was deemed highest and best use for the site giving a current market value of $2,800,000 (almost 40% higher than the previous valuation).

GCC secured a facility for the client at 80% of the higher valuation. An expatiated settlement allowed the client to settle the existing facility and draw down additional funds to accommodate their new clients to grow the business.

 

Amount: $2,800,000
LVR: 80%
Rate: 90 Day BBSW + 3.25%

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