The construction industry is a varied and complex business particularly on large development projects where there will be a number of parties involved. From developers to builders and investors each will have a role to play before a project reaches completion and everyone can benefit from the return on investment. With this in mind here are some of the key considerations when seeking construction finance and how specialist finance for the sector can help.
Construction finance can save time
Getting a development project off the ground often requires investors to finance 75% of the development cost. This can delay projects while investors are sought to meet this cost. Construction finance brokers can help secure the best rates and find suitable lenders.
Construction finance can help meet upfront payments
Construction companies will normally demand upfront payments before starting work on a project. This means developers will need the funds to pay them. These funds will come from investors but often to make investments more attractive, payments are staged. Construction finance can help with construction costs and plug any gaps in funding.
Construction companies can overcome cashflow challenges
The main challenges for construction companies are paying for raw materials and their workers. If a project is late being delivered and payment terms include a lump sum payment on completion this can mean delays to the final payment putting the business at risk. Construction finance can help reduce this risk and cover upfront costs.