Funding for property developments has always been difficult for developers. Historically, banks have been great supporters of the development community, but they don’t like to share the risks developers face. Also, to accommodate the higher risk profile, bank interest charges to developers have been significantly higher than those enjoyed by home buyers. These cost and risk factors have added levels of complexity to the development cycle, making it harder to get projects off the ground.
Now, in these post ‘Banking Royal Commission’ days, the banks have tightened lending to the Development community and, consequently, many developers are finding it hard to raise funds.
Having focussed on sourcing and selling development sites since 2017, we understand the funding hurdles faced by many developers. That’s why, when in 2018 we discovered a fledgling blockchain-based funding platform called ‘Bricklet’, we saw how developers might be able to use this innovation to break the funding deadlock.
Fast forward to 2020 and we are now working with Bricklet to enable Australian developers to source funds from the Aussie mum and dad, sophisticated, SMSF and institutional investment coming through the Bricklet platform.
Bricklet is based on ‘blockchain’ technology. When applied to property transactions, this technology enables fractional ownership of property, making it possible for small cap investors to ride the property wave with brick and mortar backed security.
For developers, this means access to an alternative funding source that enables:
100% funding of developments up-front
Retention of a percentage of available shares in the project
A low 3.3% funding cost
Thorn Property has a selection of development sites on offer that can be funded using the Bricklet platform. These sites are ideal for Seniors Living developments and are situated on the Northern Beaches of Sydney. Call or email below for details.