Do you need Finance?

17 May, 2010

In our 1st April addition  of Global Update –  Don’t let your bank suffocate your business in today’s environment!  To read this newsletter click here we talked abut the almost total reliance on New Zealand businesses, whether they be commercial, industrial or rural based, on access to credit through existing banking relationships with one of the big four Australian Banks that dominate business here in New Zealand.

Since then, despite recent announcements of substantially increased profits in the last six months from these  Banks, as our economy emerges from the recession click here, access to money through these traditional sources still continues to be a major problem.

With finance so hard to obtain we are getting more and more enquiries about what we do and how we can help.

 

So in this newsletter I thought I’d give you some idea of the sort of finance we’ve been able to arrange at Global Pacific in these difficult times, whilst at the same time reiterate that Global have available alternative competitive first tier land and building funding  products offering considerable flexibility over current restrictive bank criteria.

 

But first let’s talk about Global Pacific. Our web site describes our business and the people involved – click here to view.
What we do

 

Our business is advising on and arranging all forms of debt and equity finance for all forms of property and business.

 

We are an independent firm of commercial finance brokers with access to all the banks, prime lenders and specialised financiers in New Zealand. The individual members  of our team operate independently with their own clients, but share in the experience of us all.

 

Fees are success based payable on the satisfactory delivery of a previously agreed and mandated proposal. In other words we work with you on the type of finance your require, report back to you on the conditions under which we believe we can obtain it, receive a mandate  from you to proceed which specifies our fees, and only once a firm lending proposal is received incorporating those conditions does our fee become payable.

 

In all cases the clients know they need the money but are often not sure what form it should take. We’re also seeing clients seeking the wrong sort of finance. So our service and expertise is not only obtaining the funds for them but also advising on the type that best suits their circumstances.

 

We also work with residential mortgage brokers, business brokers, real estate agents, accountants, lawyers and other  professionals , who don’t have the contacts we have in the commercial finance environment, to arrange funds necessary for their clients to complete the transaction they are working on.

 

Another part of our business is more like a consultancy role where we are asked to advise on structuring offers to obtain funding (usually equity), undertaking negotiations with existing financiers when there is disagreement, and advisory roles generally.

 

And what we’re doing now

 

As you’d expect much of our work involves refinancing loans that were becoming due from financiers either no longer in the market literally – like Hanover and Strategic – or who had temporarily ceased or restricted lending while they sorted out their own affairs – like most of the other lenders.  But it does include new loans from some banks and non-bank lenders.

Here are some examples of finance we have arranged in the last six months.

  • Refinanced existing first and second mortgages and arranged development finance to complete the construction of a partially built 8 unit apartment complex purchased at mortgagee sale.
  • Refinanced existing bank term loans and facilities for a business involved in the publishing industry that wished to expand its operations. Obtained term loans and facility finance from a different bank at attractive rates.
  • Refinanced existing capitalised first and second mortgages on a boutique accommodation lodge and vineyard and also on a large bare land residential lifestyle block with an olive plantation.
  • Refinanced existing first and second mortgages on a partially completed commercial building and raised additional finance to refurbish and tenant so that the new valuation supported the availability of further finance to purchase  another vacant commercial property.
  • Refinanced a bare block of land for 6 months to allow the client sufficient time to create the new titles and carry out necessary civil works.
  • Refinanced a luxury 5 star lodge that had relied on wealthy in-bound tourists. Arranged the refinance of the existing first mortgage and 12 months pre-paid interest to cover mortgage costs and to allow suitable time to restructure the business and source suitable JV partners.
  • Arranged bridging finance to purchase a large dairy farm prior to the settlement of the sale of an existing farm.
  • Arranged the finance to purchase 8 new inner city apartments for university accommodation.
  • Arranged the finance to purchase bare industrial land based on an as is valuation which was greater than the purchase price.
  • Arranged development finance for an established outdoor adventure business that wished to expand its operations.
  • Arranged the finance to purchase a vacant commercial property and convert to apartments.
  • Arranged the finance to purchase a two unit site and foundations from a mortgagee in possession and the finance to complete the building of two houses.
  • Arranged the finance to purchase bare industrial land on an adjacent property using an existing unencumbered leasehold property in another location.
  • Arranged a facility to purchase a sub-divisible mortgagee sale site from a bank and the finance to subdivide into 8 titles.
  • Arranged a plant and equipment loan for a successful property developer, with his own civil works business, who had been unable to finance the purchase of a new large bulldozer.

 


What else we have been doing

Assisted an offshore resident buyer in choosing a property investment in New Zealand and arranged finance here for the purchase.

Assisted an offshore resident buyer in choosing a property investment in New Zealand and arranged finance here for the purchase.

Structured an offer for participation in an agricultural venture in New Zealand to be presented to offshore investors.

Consultancy on an on-going basis on behalf of a large scale export manufacturing start-up to secure equity funding and to secure supply of raw material for the manufacturing operation. Provided advice on structuring the supply arrangement agreement and identifying and bringing in offshore equity investors to the manufacturing arm to complete the chain.

 

 

For obvious reasons the names and details of the financing and the advisory roles we have given for the above are confidential. Often they involve more than one source of finance including private investors/lenders.

 

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Key features of funding products currently available

·         Stand alone, first mortgage only product  – no collateral security required.

  • Will lend on commercial, industrial and specialist residential/rural properties -investment or owner occupied
  • Up to 75% of lower of purchase price or valuation
  • Loan size from $200,000 – $7.0m plus
  • Terms from 1– 3 years
  • Interest rates 7.0% – 10.5% (depending on risk profile)
  • Finance fees 0.5 – 2.0% (depending on LVR and risk profile)
  • Interest only
  • Valuers mortgage recommendation not essential
  • Clean credit required
  • Available for properties located nationwide.
  • Nationwide list of acceptable valuers.
  • Mortgage recommendation not essential

Should you or any of your clients or colleagues require finance of this type, albeit commercial, industrial, rural or specialist residential or finance of any description, please call 09 303 3700.

 

Global Pacific Corporation

112 Gladstone Road, Parnell Auckland

P O Box 3229, Shortland St, Auckland

Ph  (09) 303 3700  Fax  (09) 303 3031

Website:  www.globalpacific.co.nz

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Global Update Archives

Good Times on the Way

Taking a share in Property

Finding money – Where there’s a will, there’s a way

Lack of Debt and Equity brings Opportunities.

Loans available in the $2 – $5 million range

Do you need Finance?

What we do – and what we’re doing now

Banks and other Lenders.

Finance becoming more available?

Don’t let the banks suffocate your business in todays environment!


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Global View is an email newsletter reporting on the Global and New Zealand economies with a bias towards how it affects the Property and Business Finance Market. It is a regular commentary delivered to you by email every month.

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JV Opportunities

At Global Pacific we have negotiated a number of funding arrangements where clients have taken an extremely profitable position to enable sound business and property proposals to proceed.

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