Construction Finance

Construction projects require meticulous planning and reliable financing to succeed. We specialise in providing construction finance solutions that empower developers and contractors to execute their projects with confidence. From ground-up construction to renovations and expansions, our team has the expertise and resources to secure the funding you need to bring your vision to life. With our commitment to transparency and customer service, BEDROCK Funding is your trusted partner in construction finance.

Construction Finance Services

Bank Construction Finance

Traditionally Construction Finance is done by Major Banks.  

Major Banks are by design very sponsor centric.  Their philosophy is that if we follow a good sponsor, then chances are that they will pick good projects and deliver good outcomes.
So effectively a bank would first decide whether they are comfortable with the sponsor and only then would they look at the project and location.

Non-Bank Construction Finance

Most banks and other main stream financial institutions have stringent rules and requirements with regards to loan serviceability, borrower experience, pre-sales and Loan to Value Ratios (LVR), to name but a few.  The minimum requirements would typically be the borrower’s up-to-date financials, at least 2 previous projects completed successfully by the borrower, at least 100% debt cover in pre-sales, and a maximum 65% Loan to Value limit.

There are however a substantial number of private lenders and mortgage trusts (typically referred to as Non-Banks) that are less stringent, these Non-Bank require minimum to no pre-sales (depending on the project size) and they will provide up to 75% Loan to Value limit, and up to 90% of Total Development Cost.

Non-Banks are “as a rule” more project focused, as opposed to banks that are more sponsor focused.

Mezzanine Finance

Mezzanine finance is an additional subordinated loan (behind the senior debt provider) which is generally secured by a second mortgage over the property. Mezzanine finance is used when the senior debt (i.e. the primary loan secured by a first mortgage) plus the developer’s equity is not enough to cover the total development cost of the project. Mezzanine finance can also be used to reduce a developer’s equity to allow them to use their equity for other projects and “in doing so” diversifying their risk.   Mezzanine finance comes at a higher cost, but reducing the developer’s equity contribution will increase the return on equity considerably.

Stretch Senior Construction Finance

Senior Stretch Finance is a funding option that combines senior and junior debt into a single loan to achieve a higher LVR than typically available from the major banks and other mainstream lenders.  

Senior Stretch Finance can provide funding for up to 90% of the total development cost and normally has reduced pre-sale requirements, and is therefore more expensive than traditional major bank funding.

Preferred Equity & Joint Ventures

Preferred Equity and Joint Ventures are alternatives to Mezzanine Finance and Stretch Senior pieces to increase the total project finance. For example, when the senior debt (i.e. the primary loan secured by a first mortgage) plus the developer’s equity is not enough to cover the total development cost of the project. While similar to Mezzanine Finance, Preferred Equity is not secured by a second mortgage over the property, and eliminates the hurdle of a deed of subordination debt to be negotiated with senior lenders.  This means that banks are sometimes more willing to allow senior debt with Preferred Equity rather mezzanine finance for development projects. The capital partner providing the preferred equity will usually receive a fixed percentage of the profit on completion of the profit, sometimes coupled with a small interest component.  The capital partners’ capital amount and return is secured in priority to the developer, but behind the senior debt provider.

Site Acquisition Finance

Site Acquisition Finance is financing to purchase the development site as well as to cover the associated development approval costs. We can provide financing for sites pre or post DA.  

In most cases, loan security is limited to the subject property and personal guarantee only. Interest can be capitalised for the loan period or serviced monthly.

Residual Stock Finance

It is a nature of the Property Development Industry, that not all the products will be sold and settled within 3 months of practical completion for every project you do. Sometimes the sales process takes a bit longer for whatever reason.

Most projects carry a significant portion of Construction Finance, to be repaid from Sales Proceeds at completion or within 3 months from completion and titles. This might create a problem if there are not enough settlements to achieve the repayment within the required timeframe.


Bedrock Funding’s eight step process for development funding ensures you to feel empowered and are transparently communicated along the way.