For some, the Australian dream is all about owning a home. For others, the dream centres firmly around owning and operating your own business. However, thanks to current economic and broader world factors this dream is becoming harder to not only attain, but also, hold on to. 

This is especially true for a residential property developer based in Melbourne, where everything from COVID delays to valuation pressures combined to cause urgent financial stress. Due to existing encumbrances such as second mortgages and caveats, traditional lenders were simply unwilling to help. 

Needing an urgent solution, a Melbourne-based broker approached Briqwise on behalf of the residential developer. Working with both the broker and the borrower, the Briqwise team crafted a flexible and tailored solution, despite the complex refinancing scenarios, to support the developer’s dream of continuing to own and operate a business. 

The Challenge: Multiple Pressures at Once

During the course of construction multiple strains emerged, causing financial stress and pressure to the residential developer. All of which was heightened as construction was one of the hardest industries hit by the COVID-19 pandemic. 

Firstly, developers had to contend with building delays. As more individuals were locked down, the number of home improvement projects drastically increased. Additionally, due to government schemes, more individuals opted to build new homes.

Compounding the building delays caused by increased demand for trade was the fact that the cost of building material skyrocketed. Combine increased demand with global supply chain issues and subsequently, supply went down while costs soared.

These pressures were only exacerbated by declining valuations across Victoria and personal factors relating to the developer such as the existence of a second mortgage, mortgage arrears on the owner-occupied property and the looming expiry of their construction loan. 

The Briqwise Strategy: Structured and Speedy

With multiple traditional lenders unwilling to support the residential developer navigate the complexities of the situation, the developer’s broker contacted Briqwise. Emphasising personalised and streamlined solutions, Briqwise worked with the broker to secure refinancing. 

Our tailored approach means that we can offer a level of personalisation that takes into account many different facets. For the residential developer, our team looked to provide a structured solution that consolidated high-risk debts into manageable, forward-looking facilities.

This approach encompassed three new loans totalling $10.9 million and the use of multiple securities including the Springvale townhouses. This structure was underscored by speed thanks to a clear 12 month term with a presale-backed exit strategy. 

The Outcome: Stability and Visibility

With clear terms comes improved stability and visibility. For Briqwise, this level of transparency ensures that the borrower has clear guidelines and therefore, there is a sense of risk mitigation. For the borrower, such guidelines offer insight into the repayment pathways and presale milestones. 

In terms of stability, the ability to consolidate debt across residential and development assets not only simplifies repayment but helps reduce monthly interest. All of which works to ensure access to improved cash flow. Briqwise’s strategy also lays the groundwork for future success by allowing the developer to retain equity once LVR drops below 50%. 

Why It Matters for Brokers

As a lending platform that puts people first, both brokers and borrowers stand to benefit when utilising Briqwise’s efficient and effective lending strategies. For brokers, Briqwise is another approach they can use to fulfill the needs of clients, no matter how complex the situation may seem.

Emphasising speed and personalisation, Briqwise is a competitive alternative to traditional lending. This is a huge advantage when you consider the sense of urgency that is often present when dealing with the property industry and elements of financial stress. 

Without the boundaries of traditional lending criteria, the Briqwise team can employ creative strategies that take into account individual factors to create personalised solutions. This means that brokers have a trusted option they can recommend to clients who have been refused by other lenders.

Briqwise: A Collaborative Partner for Borrowers and Brokers

No matter the complexities surrounding a situation, Briqwise can provide flexible and speedy solutions. This is why we are always looking for brokers to collaborate with. 

Briqwise’s ability to structure solutions on a case by case basis means that we can effectively and efficiently support brokers and borrowers. 

Are you a broker looking for support with a similar situation on behalf of a client? Contact the Briqwise team today at [email protected] or [email protected].

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