Sample 1 - Blog #commercial mortgagesSample 1 - Blog #commercial mortgageshttps://lololol.zohosites.com/thoughts/tag/commercial-mortgagesSun, 04 Aug 2024 05:19:49 -0700http://zoho.com/sites/<![CDATA[Common Myths about Property Development Exposed]]>https://lololol.zohosites.com/thoughts/post/Common-Myths-about-Property-Development-Exposed

5 Myths around property development that could stop you from getting started

Property investing can be a daunting prospect for those unfamiliar with the space and often many myths and misconceptions can be found circulating.

Here, we’re going to take a closer look at the myths surrounding residential property development, and provide some helpful insight into this exciting area of investing in order to help both new and seasoned property development investors alike make an informed decision.

Myth #1: You need a large amount of money to get started

One of the most common myths surrounding residential property development is that you need a large amount of money to get started. While it is true that you will need a certain amount of capital to cover the costs of materials, labour, and other associated expenses, it is important to remember that you can always secure financing through a development loan, mezzanine finance and or development equity finance.

You can also look into government grants and other financial assistance programs that can help you get started.

Myth #2: The process is too complex

Another common myth is that the process of developing a residential property is too complex. While there are a number of steps involved in a typical residential development project, it is important to remember that you can always seek professional help to guide you through the process.

Complexity should not be a discouraging factor when it comes to development; rather, it should be seen as an opportunity to learn and grow. After all, most people who successfully develop residential properties have had to overcome a number of challenges along the way.

It is also important to remember that the development process is not always linear. There will be times when you have to backtrack or adjust your plans based on new information or unforeseen circumstances. The key is to stay flexible and adaptable so that you can navigate the challenges as they arise.

With that said, here are five tips for simplifying the residential development process:


1. Work with a professional planner, project manager or principal building contractor.


2. Stay organized and keep track of all your documents.


3. Be prepared to make some sacrifices.


4. Be patient and don’t expect everything to go according to plan.


5. Keep your end goal in mind and stay motivated throughout the process.


Myth #3: You need the experience to be successful

While experience can certainly be helpful, it is not a requirement for success in the world of residential property development. There are a number of resources available to help you learn the ropes and develop the skills necessary to be successful.

Seek professional help and don't skimp on appropriate insurance cover, also ensure that your building contractors and related professions have appropriate and adequate insurance and or warranty coverage. 


Myth #4: Development is too risky

Many people believe that residential property development is too risky. While there are always risks involved in any type of investment, remember that you can mitigate your risks by doing your research.

In order to make the most informed decision possible, it is important to understand the risks and rewards associated with any investment. With residential property development, there are a few risks to keep in mind. The first is that the real estate market is notoriously difficult to predict. Just when you think you've found the perfect property, the market could take a downturn and leave you with a property that is worth less than you paid for it.

Another risk to keep in mind is the potential for cost overruns. When you're renovating a property, there's always the potential that something will go wrong and the costs will start to pile up. If you're not careful, you could find yourself in a situation where the property is costing you more money than it's ultimately worth.

Of course, all investments come with risks, but that doesn't mean that you should avoid them altogether. With residential property development, you have the potential to make a significant profit if you do your research, play your cards right and do all that is necessary to mitigate or reduce any potential risks. So, if you're looking for an investment with some potential upside, don't write off residential property development just because of the risks.


Myth #5: There’s not much money to be made

Contrary to what some may believe, there is a great deal of money to be made in residential property development. However, it is important to remember that like any type of investment, there is no guarantee of success.

One of the keys to success in residential property development is to choose the right location. The most important factor to consider when choosing a location is the potential for growth. Look for areas that are experiencing population growth or are undergoing redevelopment.

Another important factor to consider is the availability of resources. Make sure the area you choose has access to water, electricity, and other essential services.

Another important factor to consider when embarking on a residential property development is your target market. Who are you going to sell the homes you develop to? Families? retirees? First-time home buyers? Knowing your target market will help you choose the right location and design the right type of homes.

Once you've chosen a location and identified your target market, it's time to start the development process. The first step is to get the necessary permits and approvals. This can be a lengthy and complicated process, so it's important to have patience and be prepared for delays.

After you've obtained all the necessary permits, you'll need to start construction. This is where the real work begins. You'll need to coordinate a team of tradespeople, including electricians, plumbers, and carpenters. The construction process can be challenging,

If you’re thinking about venturing into the world of residential property development, remember to do your research and consult with professionals to help you make sound financial decisions.


Sort through fact from fiction when it comes to property development: 
🔷Are banks the only source of funding? Nope! Many alternatives exist that can offer great value. 
🔷Do you need a huge deposit to secure finance? Not always – we have options that suit any budget 👍 
Click Get Started Now. Let us help you finance your development projects: 
#GICCapital #PropertyDevelopmentFinancing #BusinessFinance

]]>Thu, 12 Jan 2023 00:00:00 -0800<![CDATA[How to Review Your Funding Arrangements this Year]]>https://lololol.zohosites.com/thoughts/post/How-to-Review-Your-Funding-Arrangements-this-Year

5 Reasons: Why this is the perfect time to review your funding arrangements

Whether you're a small business owner or someone just starting out in the world of entrepreneurship, reviewing your current funding arrangements can be a daunting task. But it's also something that can be hugely beneficial.

When done correctly, you can make sure that you're getting the most out of your funding and that it's working for you and your business. That's why now is the perfect time to take a look at your funding arrangements - and this blog article will show you why.

Keep reading to find out the top five reasons why you must review your funding arrangements now.

1. You may be able to get better terms

If you've been with your current lender for a while, it's worth checking to see if you can get better terms. This is especially true if your business has grown and changed since you first took out the loan. It's always worth negotiating with your lender - you may be surprised at what you can achieve.

2. Your business has probably changed since you first got funding

It's highly likely that your business has changed in some way since you first got funding. Perhaps you've added new products or services, or expanded into new markets. This means that your funding needs may have changed, too. Reviewing your arrangements now will help you to make sure that your funding is still fit for purpose.

3. Interest rates may have changed

Interest rates are always changing, and this can impact your business in both positive and negative ways. Reviewing your funding arrangements now will help you to make sure that you're getting the best deal possible.

4. You might be able to get a lower rate

As well as looking for better terms, it's also worth checking to see if you can get a lower interest rate. This is especially true if interest rates have fallen since you first took out your loan.

5. You might be able to find a more flexible lender

Flexibility is always important in business, and this is especially true when it comes to funding. You never know when you might need to make a change to your arrangements, so it's always worth having a lender who is willing to be flexible.


This blog article has looked at five of the key reasons why now is the perfect time to review your funding arrangements. Remember, your business is always changing and evolving, so it's important to keep your financing options up-to-date. 

If you need help getting started, why not speak to a business financing expert? They can assess your needs and give you tailored advice on the best way to move forward.


Taking the time to review your funding arrangements can be a valuable exercise for any business owner. 


By doing so, you can make sure that your funding is still fit for purpose and that you're getting the best deal possible. So what are you waiting for? Get started today! Click Get Started Now


#GICCapital #funding #arrangements #review #business #growth #investment #perfecttime

]]>Sun, 08 Jan 2023 00:00:01 -0800<![CDATA[The Best Lending Options for Your Business]]>https://lololol.zohosites.com/thoughts/post/The-Best-Lending-Options-for-Your-Business

Business Funding Options Explained

The type of business lending facility you choose can have a big impact on your business. In this blog post, we'll explore the different types of business lending facilities available, and help you choose the best one for your business.

There are various forms of lending facility, and the facility selected should be appropriate to the borrower’s requirements and circumstances.

Lending to businesses takes one of three general forms:

  • a bank overdraft.
  • a revolving line of credit, often known as a revolving credit facility.
  • a term loan or commercial mortgage.

Each form of lending has its own advantages and disadvantages, so it’s important to choose the right one for your business. Let’s take a closer look at each:


Bank Overdraft

A bank overdraft is a temporary borrowing arrangement that allows you to dip into your account when you need to, up to an agreed limit. This can be a useful way to manage your cash flow, as you only pay interest on the money you use. However, an overdraft is a short-term solution, and you may be charged fees if you go over your limit. Additionally, your bank may call in your overdraft at any time, which could leave your business in a difficult financial position.

Summary: overdraft features

  • A bank may agree to provide a customer with an overdraft facility, up to a stated amount (overdraft limit), for a stated period of time. The overdraft is repayable on demand.
  • An overdraft facility may be renewed when it expires; there is no formal repayment plan.
  • The facility operates through the borrower’s current account.
  • An arrangement fee is normally charged by the lender on agreement of the overdraft facility, and then annually on renewal of the facility.
  • Interest is charged on the daily overdrawn balance on the account.
  • The rate of interest payable on an arranged overdraft is subject to negotiation between the parties, and it is usually set out in an overdraft facility letter from the bank to the customer.
  • Interest is payable only on the overdraft balance, not on the total amount of the overdraft facility. A customer with an overdraft facility whose current account is in credit will therefore not pay any interest, so long as the account remains in credit.
  • A customer may repay an overdraft without giving notice. This differs from a term loan, where the customer may terminate the loan early but usually only by giving notice to the bank, and possibly also on payment of a pre-payment fee.

Revolving Credit Facility

A revolving credit facility is a form of lending that allows you to borrow money up to an agreed limit, and then repay it over time, with interest. This can be a flexible way to manage your cash flow, as you can repay the loan as and when you have the money available. However, you may be charged fees for using the facility, and the interest rate may be higher than for other forms of lending. Additionally, the lender may reduce your credit limit at any time,which could leave your business in a difficult financial position.

A revolving credit is similar in many ways to a bank overdraft, but:

* It is managed through a separate loan account and not the borrower’s ordinary bank account; and
* The borrower makes continual use of some of the facility, so that the balance on the account never becomes positive.


A revolving line of credit is also agreed for a given period, during which the borrower can draw on funds up to the agreed limit. Unlike a bank overdraft, the bank is committed to making the funds available throughout the term of the lending agreement.

Revolving lines of credit may be provided to businesses to finance working capital. As a business spends and receives cash, its working capital fluctuates in amount and its net cash flows vary. As a result, its need to borrow changes continually.


Term Loan or Commercial Mortgage

- Term Loan

A term loan is a form of lending that allows you to borrow a lump sum of money over a fixed period of time, usually at a fixed interest rate. This can be a useful way to finance a major purchase or investment, as you know exactly how much you will need to repay each month. However, if you miss a payment, you may be charged fees, and your interest rate may increase. Additionally, the lender may require you to provide collateral, such as your home, to secure the loan.

- Commercial Mortgage

A commercial mortgage is a form of lending that allows you to borrow money to buy a commercial property. This can be a useful way to finance your business, as you can use the property as security for the loan. However, you may be charged fees for using the facility, and the interest rate may be higher than for other forms of lending. Additionally, the lender may require you to provide collateral, such as your home, to secure the loan.


Other options

Other lending options may be preferred in some situations. For SMEs, these options include asset leasing and factoring of trade receivables.

  • Asset leasing

    a borrower (lessee) acquires the possession and use of an asset from a lender (lessor) for an agreed period, often several years. A leased asset for a business is a fixed asset, such as a car or truck. The lessor is a finance company (perhaps a subsidiary company of a bank), another finance leasing company, or the manufacturer of the leased asset. The lessee has possession and use of the asset but makes regular payments to the lessor, who remains the legal owner of the asset (although the lessee may have an option to purchase the asset at the end of the lease term). Asset leasing therefore involves acquiring and using a fixed asset without purchasing it, but instead making a series of payments to the lessor over the term of the lease agreement.

  • Factoring (or invoice discounting) of trade receivables:

    a specialist debt-factoring company (which may be a subsidiary company of a bank) takes over collection of the trade receivables for a client and lends money to the client against the security of future cash income from eventual receipt of payments by the client’s credit customers. Factoring is a specialist form of secured financing of working capital (trade receivables). With invoice discounting, the borrower retains the responsibility of collecting the monies due from their customer.

Purpose of security

A decision to lend to a business customer should be based on the borrower’s expected ability to repay out of the net cash inflows from business operations. Security should not be seen as the probable source of repayment (unless sale of that asset is the means of repayment, such as a property bridging loan).

 

Which Lending Facility is Right for Your Business?

The right lending facility for your business will depend on your individual circumstances. If you need a short-term solution to manage your cash flow, an overdraft or revolving credit facility may be the right choice. However, if you are looking to finance a major purchase or investment, a term loan or commercial mortgage may be a better option. Be sure to speak to GIC Capital advisers to discuss your options and find the right solution for your business.

Finance is needed for working capital because a business must incur and pay for expenditures before it receives money from sales to customers.


Take the stress out of managing cash flow and focus on running your business...
]]>Mon, 08 Aug 2022 02:15:00 -0800<![CDATA[Tips for Effective Property Investment]]>https://lololol.zohosites.com/thoughts/post/Tips-for-Effective-Property-Investment

Here are some tips on successful property investment.

Getting the finance for your property investment can sometimes be the hardest part of the process. Below is a summary of how to finance your property investment portfolio.

There are many ways to finance your property investment portfolio. You can take out a loan, use your savings, or get help from family and friends.

Taking out a loan is the most common way to finance a property investment portfolio. You will need to have good credit and be able to prove that you can make the monthly payments. If you default on the loan, the bank could foreclose on your properties.

Using your savings is another way to finance your property investment portfolio. This method is less risky than taking out a loan, but it will take longer to save up enough money. You may also need to dip into your savings if you have any unexpected expenses during the investing process.

Asking for help from family and friends is another option for financing your property investment portfolio. This method can be helpful if you have trouble qualifying for a loan or don’t have enough saved up yet. Be sure to draw up an agreement so that everyone understands their roles and responsibilities in the deal.

There are a few key things to keep in mind when you're financing your property investment portfolio. First, make sure you have a good credit score and can prove that you can make the monthly payments. Second, consider using your savings instead of taking out a loan - this is less risky but it will take longer to save up enough money. Finally, ask for help from family and friends if you need it - just be sure to draw up an agreement so that everyone understands their roles and responsibilities.

Property Investment 
 
GIC Capital has a number of property investment tips to help you get started. We have also compiled a number of useful guides and useful tips on a variety of topics to help you achieve a successful property development or property investment.
 
You can find the following guides and useful tips on a variety of topics:
 
- Property Investment Tips 
 
 
When it comes to property investment, there are a lot of things you need to consider. With our collection of guides and videos, we’re here to help you make the most informed decisions about purchasing a new property.
 
- The Process for Overseas Property Investors 
- Choosing a House Builder
 
Property Investment
 
Property Investment: Private financing of a property is usually tied to it, meaning the investment cannot be liquidated unless the person owns 100% of the underlying asset. The best example can be seen in real estate investments. Real estate lending is not an uncommon form of private lending, but typically this type has stringent needs such as ownership level and liquidity ability. There are many other types such as Home equity lines held by lenders who provide capital for owners to remortgage their home or value line removals where consumers invest to borrow against their home’s appreciation potential with terms less generous than traditional bank mortgages including interest rates over 20%. Finally, there are hard money loans where owners borrow funds secured by real estate that does not have 100% loan-to-value ratio since they want funding more quickly without mortgage approval requirements.
 
Property Investment Tips
 
1. Research the local market thoroughly before investing in a property. Consider things like population growth, infrastructure development and job prospects when making your decision.

2. Look for opportunities to add value to a property through renovation or development. This can help you increase your rental income and capital gains when you sell.

3. Make sure you factor in all the costs associated with owning an investment property, from mortgage repayments and upkeep to insurance and council rates.
 
The Process for Overseas Property Investors
 
The process for overseas property investors is relatively simple. First, the investor must find a reputable real estate agent. Once the agent is found, the investor will work with the agent to find suitable properties that fit the investor's budget and investment goals. After finding a few potential properties, the investor will then schedule visits to each property in order to get a better feel for the property and its surrounding area. Finally, once the investor has decided on a property, they will work with their real estate agent to complete all necessary paperwork including financing and purchase of the property.
 
Finding Building Land
 
Finding building land can be a difficult task. There are many considerations that must be taken into account, such as the size of the property, its location, and whether or not it has the necessary infrastructure in place.

The first step is to contact a real estate agent who specializes in finding land for development. They will have a good understanding of what types of properties are available and where they are located. The agent will also be able to provide advice on the best way to proceed with the purchase.

Once you have found a few potential pieces of property, it is important to do your own research to determine if they are suitable for your needs. This includes things like checking zoning regulations and ensuring there is adequate access to utilities and other services.

If you find a piece of property that meets all of your criteria, the next step is to make an offer on it. The amount you offer will depend on a number of factors, including how badly you want the property and how much competition there is for it. Once your offer is accepted, you can start making plans for developing the land into whatever you desire.
 
Renovate or Rebuild
 
The decision to renovate or rebuild a property is a big one. There are many factors to consider, such as cost, time, and disruption. Here are some things to think about when making your decision:

- Do you love your current neighborhood and/or school district? If so, rebuilding may not be worth the hassle and expense.
- How old is the property? If it's an older property, it may not be worth renovating if you'll have to gut the entire interior. A new build might make more sense in this case. -- - Are you planning on selling anytime soon? If you are, a renovation might not add enough value to justify the cost. You may be better off selling as-is and using that money towards a down payment on a property.
- What is your budget? A full renovation can be very expensive and may even end up costing more than a new build. Make sure you have realistic expectations for what you can afford before making any decisions. talk with experts

It's always a good idea to consult with experts before making any big decisions about your planned property work. Talk to contractors, real estate agents, and other property investors or developers to get their opinions on whether renovating or rebuilding makes more sense for your situation.
 
 
Legal Property Purchase Pitfalls
 
When you're ready to buy a property, it's important to be aware of the potential pitfalls that can occur during the process. Here are three key things to watch out for:

1. Paying too much for the property. This can happen if you don't have a good sense of what the market value is for similar properties in the area. It's important to do your research and work with a qualified real estate agent who can help you understand what a fair price is.

2. Not getting a loan pre-approval before making an offer on a property. If you don't get pre-approved, you could end up being unable to finance the purchase or having to pay significantly more than you'd originally budgeted for. Make sure you talk to a lender ahead of time so that you know how much you'll be able to borrow and at what interest rate.

3. Failing to account for all of the costs associated with buying a property beyond the purchase price itself. There are closing costs, legal fees, home inspection fees, and other miscellaneous costs that can add up quickly. Be sure to factor all of these into your budget before making an offer on a property.
 
 4. Choosing the right property lawyer
 
When it comes to choosing a property lawyer, there are a few key things to keep in mind. First and foremost, you want to make sure that the lawyer you choose is experienced in handling property law matters. This way, you can be confident that they will be able to guide you through the process and ensure that everything goes smoothly.

Additionally, it is important to find a property lawyer who is familiar with the area in which your property is located. This way, they will be able to advise you on any potential issues that could arise and help you avoid any pitfalls. Finally, make sure to find a lawyer who you feel comfortable working with and who you can trust to give you honest advice. By following these tips, you can be sure that you find the right property lawyer for your needs.  
 
 
Property development  planning permission traps
 
When you’re planning to develop a property, there are many traps that can catch you out if you’re not careful. One of the most common is failing to get planning permission before starting work.

If you start development without getting the relevant permissions first, you could be forced to undo all your work and start again from scratch. This could cost you a lot of time and money, so it’s important to get everything in place before you start.

Another trap that developers can fall into is failing to do the proper research beforehand. If you don’t know what restrictions or requirements are in place for the area you want to develop, it could cause problems further down the line. Make sure you check with the local authority and do your own research before making any decisions.

One final trap to avoid is taking on too much risk. Developing property can be a risky business, so it’s important not to bite off more than you can chew. If you take on too many projects at once or overextend yourself financially, it could lead to problems further down the line. Be realistic about what you can achieve and only take on as much as you can handle.
 
 
Problem construction sites.

Construction sites can be noisy places. The sound of hammers and saws, along with the hustle and bustle of workers, can create a din that can be overwhelming. This noise can cause problems for people who live or work nearby. It can be difficult to concentrate on tasks or to get a good night's sleep when construction noise is constant.

There are ways to mitigate the effects of construction noise. One is to create buffer zones between construction sites and residential or commercial areas. This can be done by setting up barriers such as Sound Walls or using other methods to reduce the amount of sound that carries from the site to surrounding areas.

Another way to lessen the impact of construction noise is to schedule work during times when it will have the least effect on people in the vicinity. For example, avoiding night time work or working during weekends when people are more likely to be home and trying to relax. By being conscious of the times when construction noise will impact people the most, developers and contractors can make an effort to ease the burden on those who live and work near their projects.

 
Access and services to your building plot
 
When you buy a building plot, you are not only acquiring the land on which to build your home, but also gaining access to essential services. These may include water, electricity, gas, sewerage and telecommunications.

The first step is to check with the local authority or utility companies what services are available in your area and at what cost. You will need to factor these costs into your budget for buying the land.

Once you have established what services are available, you will need to negotiate with the seller of the land for connection to these utilities. This can be a complex process, so it is important to seek professional advice before proceeding.
 
 
Bad building design
 
 A poorly designed building can be an eyesore, and it can also pose serious safety hazards. Badly designed buildings can be structurally unsound, and they can also be difficult to evacuate in the event of an emergency. Poorly designed buildings can also create problems for first responders who may have difficulty accessing the premises.

In some cases, badly designed buildings can even lead to fatalities. In 2015, a poorly designed building in India collapsed, killing over 100 people. The building had been constructed with substandard materials, and it was not up to code. As a result, when heavy rains caused part of the building to collapse, the rest of the structure quickly followed suit.

Badly designed buildings are a hazard to both the people who occupy them and the first responders who may need to enter them in an emergency. It is important that all buildings be constructed using high-quality materials and that they meet all applicable safety codes and standards.
 
 
House building finance: borrowing money
 
Borrowing money to finance a house purchase is a decision that should not be made lightly. There are a number of things to consider before taking out a loan, such as the type of loan, the interest rate, and the repayment schedule.

One important factor in deciding whether or not to borrow money for a house purchase is the type of loan. There are two main types of loans: fixed-rate and adjustable-rate mortgages (ARM). A fixed-rate mortgage has an interest rate that does not change over the life of the loan. This stability can make budgeting easier because there are no surprises when it comes time to make your monthly payment. An ARM has an interest rate that changes periodically, usually in response to changes in market conditions. This means that your monthly payments could go up or down depending on economic conditions.

Another important factor to consider is the interest rate on the loan. Interest rates can vary significantly from lender to lender, so it’s important to shop around for the best deal. In general, you will get a lower interest rate if you have a good credit score and can offer collateral such as equity in another property.

Finally, you need to think about how you will repay the loan. Most loans have a fixed repayment schedule, which means you will make equal monthly payments over the life of the loan. However, some loans offer flexible repayment options, which may be more suitable for your needs. For example, you may be able to choose between making interest-only payments or paying down both principal and interest each month.

Making smart choices about borrowing money for your home purchase can save you thousands of dollars over the life of your loan. By carefully considering all of your options, you can find a loan that meets your needs and helps you reach your financial goals."
 
Construction Loans or Property Development Finance
 
A construction loan is a short-term loan used to finance the building or renovation of a home or other real estate project. Construction loans are typically Interest-only loans, meaning that the borrower only pays the interest on the loan during the construction period.

Construction loans are typically used by real estate developers and homebuilders to finance the construction of new homes or buildings. These loans are usually short-term, lasting between six months and three years. During this time, the borrower makes interest-only payments, meaning that they only pay back the interest on the loan during construction.

Once construction is complete, the borrower then begins making principal and interest payments on the loan until it is paid off in full. Construction loans can be either fixed-rate or adjustable-rate mortgages (ARMs). Fixed-rate construction loans have an interest rate that remains constant throughout the life of the loan. Adjustable-rate construction loans have an interest rate that fluctuates with changes in market conditions.
   
Bridging Mortgage
 
Bridging loans are short-term finance options that can be used to 'bridge the gap' between two larger financial transactions. For example, if you are selling your current home and buying a new one, you may need a bridging loan to cover the cost of the new property while you wait for the sale of your old one to go through.

Bridging loans are typically interest-only, meaning that you only have to pay back the interest on the loan each month. This makes them a less expensive option than taking out a traditional mortgage, which requires both principal and interest payments.

However, because they are short-term loans, bridging loans often come with high-interest rates. This is because lenders view them as higher risk than other types of financing. As such, it's important to compare different lenders before choosing a bridging loan so that you can get the best rate possible.
 
Commercial Mortgages
 
A commercial mortgage is a loan taken out on commercial real estate, such as an office building, retail space, or industrial warehouse. The proceeds from a commercial mortgage are typically used to finance the purchase or refinance of the property.

Commercial mortgages are generally more expensive than residential mortgages, due to the higher risk involved in lending on commercial properties. However, they can be a good option for investors who are looking to finance the purchase of income-producing real estate.

If you're thinking of taking out a commercial mortgage, it's important to understand how they work and what fees and charges you may be responsible for. This guide will give you an overview of everything you need to know about commercial mortgages.
 
Modern Construction Methods
 
Insulated Concrete Form (ICF)
 
Insulated Concrete Form (ICF) is a type of construction material used in the building industry. ICF is made up of two layers of concrete separated by an insulating material. The most common type of ICF is made with polystyrene foam, but other materials such as polyurethane and fiberglass can also be used.

ICF construction offers many benefits over traditional construction methods. One of the most significant advantages is increased energy efficiency. ICF homes are much better insulated than homes built with traditional methods, resulting in lower heating and cooling costs. In addition, ICFs provide excellent protection against natural disasters such as hurricanes and earthquakes.

If you are considering building a new home, office, or other type of structure, Insulated Concrete Form (ICF) construction may be the right choice for you. Contact a local ICF contractor to learn more about this innovative building method and get started on your project today!
 
Choosing a House Building Contractor
 
It is a big decision to choose a contractor to build your property. You want someone who is experienced, reliable, and within your budget. Here are some tips on how to choose a house building contractor.

First, you should get recommendations from people you know and trust. Talk to friends, family, and colleagues who have had recent positive experiences with contractors. If you don't know anyone who has used a contractor recently, look for online reviews. Make sure to read multiple reviews to get a well-rounded idea of the contractor's work.

Second, interview several contractors before making your final decision. Ask each one for references from previous clients. Once you have the references, make sure to follow up with those clients to ask about their experience working with the contractor. In addition to asking about the quality of work, also inquire about timeliness and professionalism. It is important that you feel comfortable communicating with your chosen contractor throughout the construction process.

Finally, be sure to sign a detailed contract with your chosen contractor before any work begins. The contract should spell out exactly what work will be done and how much it will cost. It should also include a timeline for the completion of the project. By having everything in writing beforehand, you can avoid disagreements or misunderstandings down the road.


Are you a property developer, home builder or house builder looking to grow your business? Our experts can help you take your business to the next level. 
]]>Thu, 12 May 2022 22:00:00 -0800<![CDATA[Property Factors to Consider - Apartment Blocks - Private Rental Sector ...]]>https://lololol.zohosites.com/thoughts/post/Property-Factors-to-Consider-Apartment-Blocks-Private-Rental-Sector-...

Unfortunately, like with any new venture, its not uncommon to see new and sometimes "seasoned" investors getting hung up on the wrong aspects or less viability-breaking elements of an investment property. This is one of the main reasons why lenders funding real estate or property investments emphasize on the mandatory requirement experience in the majority of cases, especially for larger transactions. 


So, what should a potential investor be focusing on? Below are some of the main factors to consider when analysing a property for investment: 

  • Net Operating Income (NOI) 
  • Taxes & Entity Structure (Current and Future) 
  • Physical Condition 
  • Location including 

    • Crime 
    • Employment 
    • Amenities 
    • Transport Links 
    • Future developments and growth trends

We aim to deliver much needed capital for SME’s and Property Developers.

These are just some of the factors to determine whether or not the apartment block investment works not only for you but ultimately makes sound financial sense and you able to get funding and maybe even Joint Venture investors.   

1. Net Operating Income (NOI) Analysis 

Any property investment (apartment building) or business is a good or bad investment based on how much money it makes versus how much you paid, including the cash you used as well as on-going operating costs. 
Since no two owners’ NOIs will ever completely match due to circumstances surrounding tax, funding terms, entity structure, management and management costs etc, you must always look at all the revenue and expenses for the way you plan to run the building to arrive at your own NOI moving forward.
Looking at existing operating expenses and revenue is a good starting point to help you justify for offering price, but not necessarily going to be your financial position ongoing, and one would hope that you would be able to improve/ enhance your NOI through value-add to make this an even more worthwhile investment. 

Examples of value add changes 
  • Setting rents and or review to not only maintain your occupancy threshold but perhaps improve? 
    • 100% occupancy may come at the expense of forfeiting some rent, while 
    • Lower occupancy, say 90%, would maximize rent revenue. 

The perfect scenario being 100% occupancy and maximum if not premium rents 

  • Any planned property improvements to the building should increase tenant appeal and improve asking rents compared to market. 
  • Offering anything from pet rent to move-in fees and paid parking allocation could improve your revenues therefore NOI. 
  • Property management? Will you manage the building yourself or hire professional third-party management company? 
  • Property Maintenance? Will you do minor repairs inhouse or via professional maintenance contractor to fix things? 
All these items affect either the revenue or expense, meaning the NOI. Only after determining the NOI based on how you will run the building can you evaluate that number as a return on your investment (otherwise known as a cap rate) to determine what you should pay for the building.  
Potential Gross Income (PGI) aka Gross Scheduled Income (GSI) 

This is about how much anticipated income your property will generate if all units within it are rented and if there are no rent defaults. This can be a very useful measure to compare against your actual income. 

Potential Gross Income = Rental Income + Lost Rental Income from Vacant Units
Gross Operating Income aka Income from Operations 


This figure reflects the gross operating income in addition to all other sources of income from your rental property. This can include revenue from parking spaces, public vending machines, pet rent etc. 


Gross Operating Income = (PGI – Lost Rental Income from Vacant Units) + Other Income 
Net Operating Income 


You first need to figure out your gross operating income. Once you have that figure, you subtract your operating expenses (insurance and maintenance costs etc). You should note, however, that things like investment property depreciation and interest payments do not factor into operating costs.  


Net Operating Income = Gross Operating Income – Total Operating Expenses
Capitalization Rate 


Also known as Cap Rate, is one of the most important real estate formulas. The cap rate formula compares an investment property’s net operating income with its market value, allowing investors to quickly compare properties to see which one is most worth it. 


Cap Rate = Net Operating Income / Market Value of Property 

2. Taxes as well as entity structure, current and future 

Whether you are a new or seasoned investor, always consult with a property tax professional, usually a qualified and chartered accountant. This is no time for DIY, money saving tactics because a significant movement in property taxes can quickly erode all the upside forecast for your investment and make it not only none profitable and maybe even loss making. 
Factors such as the right purchasing entity structure as well as any joint venture agreements etc are all matters for professional qualified guidance and not your mate down the pub. 

3. Physical Building / Property Condition 

Focus here should be at examining the major fixtures and fittings of the building such as  Roof, Heating and Cooling systems, Electrical and plumbing, Windows, Exterior, etc. 
A thorough examination by local contractors who specialize in each building aspect to look at and give you their professional opinions on current state, maintenance repairs required and or replacements, will help you determine if a system is sufficient or needs short- or long-term attention as well as likely costs and timing. 
Awareness of current state of the building and future possible repairs both major and minor will enable adequate expenses provision in your maintenance and repairs budgeting. 
  • For short-term needs (meaning anything within five years), you will need to budget for them as one-time expenses, as well as for other major items you cannot anticipate. These are capital costs, not operating costs, so the full amount should not be included as an annually occurring expense in the NOI. 
  • Instead, a line item in operating expenses should be reserves, which is an estimate of all the major short-term needs of the building spread over time and budgeted on an annual basis. The easily anticipated costs are system replacements — boiler, roof, windows, electrical, plumbing, etc. You should estimate when you think systems will need to be replaced and their cost, and analyse their lifespan once installed. You can then estimate how much money you need to set aside for these items. 
  • Harder-to-anticipate issues are when a tenant wrecks the apartment and moves out in the middle of the night with all the appliances, and you have to renovate and replace everything. 

4. Location, Amenities, Transport Links, Trends 

One of the primary drivers of value in any real estate is its Location & Convenience , Transport Links, Amenities, Employment, Education, Etc. 
It can also be just a matter of supply and demand. Limited supply and high demand coupled with local authority building restrictions or availability of building space are a sure positive factor for a location, the all the other above points also being positive. 
All factors you should consider as to why market rents are as they are and why anyone would be willing to pay anticipated rent for the location. If you cannot come up with three compelling reasons putting yourself in potential renters shoes, you should probably pass on the location. 

In conclusion, do your homework and seek professional guidance and look at market data sources for factual information and to make a well informed investment decision. For your commercial or investment property finance the team at GIC Capital are available to give you professional guidance with any and all your funding requirements. 

By CEO, GIC Capital 
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