What is site acquisition finance for SME developers?

Site acquisition finance can be thought of as a bridging loan as it is a short-term (3-24 months) finance option designed to help you secure a property purchase quickly.

Developers can use a site acquisition loan at the outset of their projects, to complete settlement for land purchases.e. This enables them to acquire land even before the development application (DA) process.

Site acquisition loans are highly suited to developers who need speed and certainty of funds to move quickly on a project site. While banks will offer potentially lower rates, they are often slower than specialist lenders who understand why speed matters to small and medium developers. They also typically require the loan to be serviced.

A site acquisition loan is often in the form of a bridge loan, which means it’s an interim financial arrangement designed to serve a specific purpose for a brief period. In such cases, developers should have a clear exit strategy for the loan, using it as a stepping stone to a more stable form of long-term refinancing.

Key things to provide when seeking a site acquisition loan are:

  • The amount of your own cash in the deal — aka ‘skin in the game’.
  • Your confidence in gaining planning approval
  • A feasibility that ‘stacks up’, ideally min. 15% with commercial lending rates
  • Sponsor’s experience

At CrowdProperty, you gain the advantages of:

  • Speed, expertise and certainty of finance
  • The option to roll into project development/construction finance
  • A partner on your team who will constructively work through projects and any issues that come up along the way
  • As experts in the property sector, CrowdProperty can provide specialised financial services to small-scale - developers at all stages of their projects, including site acquisition loans. Click here to learn more.
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