Development finance uses different assessment metrics compared with standard property loans. The most common terms include GRV, LTC, LVR and feasibility.
What is GRV?
GRV stands for Gross Realisation Value. It is the estimated total value of the completed project, based on valuation and expected sale prices.
What is LTC?
LTC stands for Loan to Cost. It measures the loan amount against total project costs, including land, construction, professional fees and other costs.
What is LVR?
LVR stands for Loan to Value Ratio. In development finance, this may be assessed against the value of the site or the completed project value, depending on lender policy.
What is feasibility?
A feasibility report shows whether the project is financially viable. It generally includes land cost, construction cost, professional fees, finance cost, sales income and projected profit.
What lenders look for
Lenders generally want to see:
- Strong feasibility
- Realistic construction budget
- Experienced builder
- Clear approval pathway
- Suitable contingency allowance
- Sensible exit strategy
How Nine Fincap can help
Nine Fincap reviews your feasibility, funding requirement and project structure before approaching lenders or private funders.
Have a project feasibility ready? Upload Your Feasibility for assessment.
Disclaimer
This information is general only. Development finance is subject to lender assessment, valuation, quantity surveyor review and funding approval.