update: 16th august 2007

Our Commercial Underwriters are flush with funds at the moment and looking to expand their reach into new types of commercial property. Commercial Term Loans remain extremely competitive with no ongoing fees and at low margins above the bank bill rate. For some development clients we are using these low-cost funds as a take-out facility or land bank facility until construction commences.

Land Sub-Divisions in the outer suburban and growth corridor areas are becoming a profitable venture for several of our clients who are advantaged by our ability to fund their project costs and capitalise interest. We are also witnessing the emergence of more semi-rural sub-division activity.

We are continuing to receive development finance applications in a market that is unlikely to support further high-rise development, however, these new projects, which are of a smaller nature ($2-5 million), are benefiting from our ability to provide finance up to 80% of the Gross Realisation Value. Location of these new developments has been vital in ensuring our clients are insulated from the negative perception currently held by investors, of an over-supply of apartment-style property.