What type of Finance can CapStack assist with?
We work with an entrepreneurial approach.
Our property expertise and entrepreneurial approach to financing allow us to work creatively with our clients and structure an appropriate financing solution to help them achieve their goals.
Below we will review various loan types that CapStack can help with.
Commercial Property Finance
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Whether you are a business owner looking to purchase and occupy the property for your own business, such as a warehouse, office, retail store, or medical practice, or an investor who intends to purchase a commercial property as an investment and proceed to lease it out, we can help. We can also help you refinance an expiring or unsatisfactory loan.
Additionally, if you are self-employed, have income streams that may be difficult to prove, average credit, or require an urgent settlement, private commercial finance may work for you.
We don’t work conventionally but rather we seek to provide solutions as required by the client.
Development Finance
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CapStack can help source and secure development finance that a developer can draw-down in stages generally in line with key construction stages or settlement of the purchase and allow for interest payments on the amount drawn-down. it.
CapStack will work with lenders to review a project’s stage of development, the expected construction period, and risks. We can determine the right financing solutions to meet a developer’s specific needs, time frame and business plan.
Development finance can be used for the following types of developments projects:
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Residential Projects.
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Commercial.
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Industrial.
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Office
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Retail.
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We can also advise on land acquisition as part of the construction finance.
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Incomplete Developments
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Distressed and Workout Situations
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Presale and Non-Presale options
We can help source financing for all property types, project types, and project sizes.
Residual Stock Finance
Once a development or construction project has been completed options exist for the owner to release equity out of the project via residual stock finance. This type of finance provides funding of the completed but unsold development stock.
Residual stock finance allows for:
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Providing the developer with more time to sell stock
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Providing the developer with equity to move on to the next project
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Lower rate (especially id mezzanine finance was used initially)
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If existing lender is requesting payback.
Construction Finance
We can help provide construction finance for:
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Commercial.
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Industrial.
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Office
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Retail.
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Residential Projects.
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We can also advise on land acquisition as part of the construction finance.
Every construction loan is different, because no two projects are ever the same. Clients can benefit from our experience in securing favourable lending terms based on the needs of each individual project.
Equity Placements
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Opportunities present themselves whereby we have parties interested in becoming equity partners with developers. Similarly, with joint ventures. If this is something that is of interest to you or could work for your scenario please let us know.
Mezzanine Finance
Mezzanine finance refers to subordinated debt or preferred equity instrument that represents a claim on a company's assets which is senior only to that of the common shares. Mezzanine financings can be structured either as debt (typically an unsecured and subordinated note) or preferred stock.
Here is an example of mezzanine finance in use:
A property developer looking to get a project off the ground may tap sources of funds.
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A traditional lender, who will take out a 1st mortgage o the property. Generally, a bank will manage their risks by lending up to a certain amount only, eg 50%.
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A mezzanine investor may then provide the next 45% of the money and gets a second mortgage.
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The third and final level of funds may be a 5% contribution by the property developer.
Given that mezzanine lending presents a higher risk to the lender (as they are second in order of payouts due to the second mortgage), interest rates are higher.
CapStack can help connect you to the right lenders who can provide the right mezzanine finance to help developers of all sizes get their projects off the ground.
Bridging Finance
Bridging finance is a short-term loan, generally taken for up to 1 year and it primarily provides interim financing until permanent financing is obtained. Once the new financing is organised (ether via property sale or refinance) the bridge loan is paid back.
For commercial property, bridge loans are used for example to quickly settle a property purchase or take advantage of a short-term opportunity to secure long-term financing. Another example is a developer in the period of waiting to finalise plans and permits.
Other uses for Bridging Finance include:
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Property acquisition prior to selling an existing property.
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A situation where a quick settlement is required.
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Opportunistic purchase. If you find yourself here, then contact us for a private bridging home loan.
Get in touch with us to learn more how CapStack can help.
Short-Term Lending
Short-term finance works best when there is an immediate problem that needs to be addressed, or when one would like to fulfil and take advantage of an unexpected opportunity.
For property owners and investors, short-term finance can allow for:
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Urgent settlements.
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Bridging finance to fill the gap between the purchase and sale of a property.
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The ability to act quickly on advantageous opportunities.
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Tight deadlines that need to be met.
For businesses and business owners, a short-term lending facility can help businesses meet an increased demand for cash-flow. For example, to fulfil an unexpected opportunity or address an immediate problem. This is particularly true today where the lending criteria from traditional sources is tightening.
Such challenges that can be negated by short-term lending include:
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Paying tax liabilities and ATO debt.
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Refinancing debt or deleveraging from a lender.
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Resolve potential insolvency issues and allow for business turnaround.
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Creditor repayments.
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Equity release.
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Debt refinancing.
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Take advantage of seasonal trends, such as by purchasing additional inventory or hiring extra staff in a holiday period.
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Business emergencies, such as equipment breakdown
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Working capital, to purchase stock for example.
A short-term finance facility can allow a business owner to capitalise on an unexpected opportunity, such as:
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Bridging the gap between the sale and purchase of property.
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Rapid drawdown and equity release.
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Acquiring a competitor or complementary business.
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Growing a business when capital is required upfront
(i.e. for staff, marketing, an office fit-out or IT infrastructure).
1st and 2nd Mortgages
CapStack can help borrowers source 1st and 2nd mortgage.
The first loan registered against a property is known as the ‘first mortgage’. The second loan or mortgage registered against a property is known as the ‘second mortgage’.
The primary difference between the two, is that should the borrower default, the first mortgagee will get paid out first. Second mortgages therefore carry a greater risk for the lender and will therefore require to higher interest rates.
In both cases, these loans and their security rely on the property in question. The security can be commercial, residential, or industrial.
Caveat Lending
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Caveat Loans can be a great option when you need a fast and flexible way to take value out from your property. A caveat loan is finance secured by a charge (known as a caveat) on your property.
Caveat Loans are suitable for a range of purposes and situations. They can be used for property improvements, renovations and upgrades, business uses development, equipment purchasing, business cash flow or business debts.
If caveat finance makes sense for you, reach out to the CapStack team to discuss your options.
Business Finance
CapStack can help you build and grow your business by connecting you to the right business lender and financing product. Our business finance lenders can provide fast and flexible funding solutions to meet the needs of businesses of all sizes, from new business, SME’s and bigger businesses.
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It’s no secret that SMEs often have difficulty finding the right loan or financing option when they need it most. CapStack can provide access to specialised asset lenders who can provide a broad range of options for business finance, whether for the purchase of inventory and equipment, ATO issues and tax purposes, upgrading a workspace or business premise, managing cash flow and more. Many lenders provide fast turnaround times and there are options where security is not necessarily required. Loans can be short-term or longer term, and if security is needed can secured by property, via a 1st or 2nd mortgage.
Asset and Equipment Finance
If you are purchasing an asset for business or for private use, we can connect you to a variety of lenders and options to tailor your finance needs to meet your goals, financial circumstances, and objectives.
Asset Finance is often used for:
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Purchasing a car for personal or business use.
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Purchasing business equipment and machinery.
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leasing options for equipment, machinery, and vehicles.
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Chattel mortgages can utilised.
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Debtor Finance
Debtor Finance is a line of facility credit linked to and secured by a business’s outstanding accounts receivable. This sort of facility can be useful for any business that supplies products or services to other businesses on standard trade credit terms, and Invoices are issued for delivered goods or completed services.
Benefits of Debtor Finance include:
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No need for property as security (as opposed to a traditional bank loan).
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Standalone facility outside of your business general and traditional financial products.
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Improves cash flow.
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The facility can grow alongside your business.
Below are the different types of Debtor Finance:
Factoring
Factoring provides a line of credit to businesses, secured against their outstanding accounts receivable. Also knows as full service debtor financing. Factoring is suitable for businesses of all types and sizes (including those in a turnaround).
Benefits include:
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No need for property as security
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Facility can grow naturally along with the business
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Allows business owners to focus on building their business without having to constantly chase up customers for payment.
Selective Input Finance
Selective Invoice Finance is a credit line secured by one or more outstanding sales invoices. The business owner can submit an invoice of their choice against which to fund. This is an easy and fast way for businesses to access additional finance and working capital on an ‘as-needed’ basis rather than needing to commit to a long-term facility.
Invoice Discounting / Invoice Finance
Invoice discounting is a good option for businesses that supply goods or services to business customers on standard trade credit terms. Simply, it is a line of credit secured by outstanding accounts receivable.
Benefits include: no need for property security and limits can grow in line with revenues. This facility type works best for small-to-medium sized businesses that keep an in-house accounts receivable team, with a demonstrated ability to perform the collections activities such as calls, reminder letters, and issuing monthly statements.
Progress Claim Finance
Progress Claim Finance is a solution for businesses that engage in contractual type arrangements and raise progress claims under the Security of Payments Act.
Lending Against an Asset
Asset Finance allows you to access additional funding against your plant, machinery, equipment or property, to maximise working capital available to your business. Benefits include the ability to access additional finance for growth or merger/acquisition scenarios, and flexible repayment options. This option is suitable for businesses with significant assets (e.g. property or equipment) available to fund against.
Trade Finance
Trade Finance is a form of working capital which generally provides for the financing of cross-border, import/export transactions. For an importer, funding is provided to enable a payment a supplier and allow time for the goods to be received and sold. For an exporter, it provides working capital until the customer pays for the delivered goods.
Additional Business Finance types that CapStack can assist with include:
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Fitout Finance
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Sale and Lease-Back
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Private Lending
Private lending in its most basic form is where a lender or investor provides capital directly to a borrower for a specific transaction, and generally takes place in the non-bank environment.
With Private Lending, the two sides of the transaction have a more direct relationship than in the traditional banking environment. These transactions are therefore not regulated by ASIC or APRA and are commonly referred to as being ‘non-coded’.
Property Types CapStack can assist with for financing purposes:
Offices
Office Buildings
Hotels
Retail
Shopping Centres
Warehouses
Industrial Property
Land
Construction
Developments
Apartment Buildings
Townhouse Projects
Healthcare
Student Housing
Senior Housing
Self-Storage
Land
Land Banking
Land Subdivions
Rural Properties
Medical Practices and Facilities
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