Land Development Financing
Buying and developing land is capital intensive, which requires
land development financing. Here is how land development
financing helps you for land development purposes.
* Land development financing and liquidity: Land development
financing helps the residential land developers with the
necessary resources to control their finances. This provides
cash flow and liquidity for the project.
* Land development financing and ongoing finance: Land
development financing is a reliable source of continuous finance
for existing and future subdivision projects.
* Land development financing and projects: Financing for land
development provides the developer with the resources and
products for development of the project.
* Land development financing and land notes: Land development
financing allows land note portfolio purchase in lump sum. This
also allows a committed credit line to help instant purchase of
land for development. The developer can take advantage of better
land purchase price because of ready cash made available through
land development financing.
* Land development financing and joint venture: Land development
financing through the debt equity program provides 100%
commercial loan for niche product development. The minimum loan
amount is $5million, involving an insurance financial guarantee
from the investor and a joint venture for that particular
project.
Land Development Financing for Land Development Costs
Land development costs are quite substantial and are tided over
through land development financing. Certain factors involved in
land development ascertain financing needs. The geographical
location of the development site affects the construction and
land development costs based on the distance associated with
transporting construction material, transporting workers,
distance of waste sites, and connecting the site to the nearest
roads. The more cost involved in the geographical location
factor, greater the amount of land development financing.
Land development costs are influenced by zoning, which involves
density and land size. Low-density zones increase the land
development costs. Thus, land development financing depends upon
the zoning factor.
Topography and soils too have a direct bearing on the
development costs. Steeper sites and poor soil conditions
increase the land development costs and correspondingly, the
land development financing needs.
Development of subdivisions at higher elevations for
construction of water pump station and reservoirs too add to the
land development costs, which in turn effect the land
development financing requirements.