Seymour Group sets sights on mezzanine finance
Richlister Kevin Seymour is likely to re-enter the mezzanine debt arena, lending to residential developers as banks continue to tighten their lending criteria.
His Brisbane-based Seymour Group, which is striking deals to sell more than $230 million of Brisbane commercial property, is looking at lending on two projects, Seymour told The Australian.
The group is considering providing funding on raw land subdivisions.
“We are getting one or two requests a week for mezzanine finance,” Seymour says.
We will lend 25%, providing the developer also has 25% skin in the game
“It’s a sign of the times. The banks must be reducing their lending ratios.”
While this applies mostly to residential projects, lending ratios on commercial development are also tightening, he says.
“Funding has changed dramatically in recent months.”
Banks are now requiring about 50% equity in a new residential project and 40% equity for a commercial project.
Gaming giant Echo Entertainment is buying the Festival Car Park on Charlotte St from Seymour for more than $40 million.
Seymour says the group will lend 25% on projects of up to $100 million, though most raw land development is more likely in the up to $50 million range.
“We will lend 25%, providing the developer also has 25% skin in the game,” Seymour says
Earlier this month The Australian flagged that Singapore-listed ARA Asset Management had emerged as the leading suitor to buy Seymour Group’s Brisbane trophy office building HSBC Tower at 300 Queen Street in a deal worth close to $190 million.
We are getting one or two requests a week for mezzanine finance
Seymour, who made his first fortune from of car parks, listed a portfolio including the HSBC Tower and two car parks last October via JLL and Knight Frank.
Gaming giant Echo Entertainment is buying the Festival Car Park on Charlotte St for more than $40 million, expanding its holding around the casino.
This article originally appeared on www.theaustralian.com.au/property.
