Wednesday, September 24, 2008

> Sourcing Finance


Western funding profiles?

There are different investors interested in the property and construction market in most countries showing an annual let of over 10%; most are looking at either purchasing an existing Class A building fully let on long leases to prime tenants, or funding a Class A construction project to purchase at term when fully let.
Corporate investors & Investment Funds British construction companies European construction companies European and British end users such as supermarket groups, hotel groups etc.

These companies are looking for joint venture opportunities, or to buy specified commercial centres or hotels, and sometimes to manage hotels only.

International prime banks: These banks are potential lenders for corporate lending (debt finance) and/or project finance with the period of the loan and the interest rates to be decided according to different factors. Sometimes the banks will syndicate large loans with other investors, and they expect the project owners to have invested over 25% into the project. They will look for guarantees against finance which could be guarantees by the City Administration, by another prime bank, mortgage on the land for the project, mortgage on property owned by the borrower, options on shares in the corporate structure of the borrower, and sometimes other guarantee requirements.

Investment Funds : These funds invest in companies and in projects well defined and properly managed. Same applications as above, they will take shares and expect to take profit from the share value increase, the revenues, and the capital appreciation of the project.
Private Equity & Venture Capital Funds : These funds invest in companies by taking equity, or projects held by companies. They expect to take a profit with an agreed clear exit policy (selling to an end client) within 3-5 years, selling to an identified purchaser or to go AIM/IPO on the London Stock Exchange.

http://www.advent-uk.co.uk/gb/opportunity_01.htm