Real estate development facilities — key features

Real estate development finance facilities involve a loan to the borrower for it to purchase and develop a property (or a group of properties) or to develop a property (or group of properties) that it already owns. This financing is secured against the property, the development documentation and the future cashflow generated by the property (for example, rental income or the proceeds of settlement of off the plan sales) once the development (or part of it) has been completed.

Many of the features of a typical real estate acquisition finance facility will be applicable to real estate development finance transactions. For information on the key features of real estate acquisition finance facilities, see Real Estate acquisition facilities — key features.

This guidance note examines the key features of development facilities (for example, security over development documents and side deeds) and how they differ from acquisition facilities.

See Real estate development facilities — key features.