The value of property developments intended for sale
As well as finding the inspiration and the right property, the structuring of the financing is one of the foundation blocks of every property development project. But wherever the developer sees opportunities, the lenders will always focus on the risks. Traditional lenders calculate risks based on empirical values and partly on what are very rigid parameters and lending conditions. With its ONE Real Estate Debt Fund (OREDF), Property One values development projects in a very pragmatic way, using its inherent capacity as a real estate service provider. This automatically leads to a more dynamic capital structure and more efficient financing solution.
Limited choice of experienced capital providers
Time and again, we see lenders placing great value on the developer’s experience and equity investment. Many lenders are trapped inside their lending conditions, which make them less flexible. We also find that they often lack the connection to the real estate development industry and that processing a lending application takes up a considerable amount of time. The ONE Real Estate Debt Fund serves as a lending partner for those operating in this industry.
Property One provides access to subordinated real estate loans
Property One comes into play wherever traditional mortgage institutions are unable to accommodate a high level of lending or where time is of the essence. We give interested potential borrowers access to subordinated financing. We arrange the financing and assume responsibility for all services involved in the process. This is often carried out with a focus on cooperation and agreement with the other financing party.
Property One launched the ONE Real Estate Debt Fund in February 2021. The ONE Real Estate Debt Fund was created to allow real estate investors access to more financing opportunities using subordinated loans. The fund grants loans which are secured by promissory notes. The amount of the loans ranges between CHF 1 million and CHF 30 million. The maximum term of the loan is 36 months.
Loans are granted for investment properties, bridge financing and construction projects (including those intended for sale), for commercial and residential use (excluding owner-occupied housing). All kinds of commercial uses are included (offices, sales, logistics, manufacturing, industry, hotels, etc.).
Loans on development projects intended for sale
Property developments which are well thought through, both qualitatively and quantitatively, but have a financing gap can be brought to fruition thanks to the ONE Real Estate Debt Fund. We are particularly dynamic and close to the market when it comes to project developments. The line of credit may be used flexibly and adapted to the particular phase of the project. The ONE Real Estate Debt Fund guarantees planning reliability and the project can go ahead without having to wait. The shorter length of the project – which means lower equity investment, as well as the resulting significant increase in return on equity – compensates for the interest costs of the loan.
Example: Credit on promotional object
Property One’s offering is aimed at professional players in the Swiss real estate market, including property owners, architects, project developers, building contractors, etc., and offers an additional option alongside conventional real estate financing.
The granting of credit requires an in-depth assessment and approval of the counterparty, the security and the transaction as a whole.