In short
- 3 pillars of the structure: equity (15-30%), bank debt (40-65%), pre-marketing / own funds (10-30%)
- Sources-and-uses table: break it down month by month over 24-48 months (land → studies → construction → marketing → delivery)
- Expected bank ratios: LTC (loan-to-cost) ≤ 65%, exit LTV (loan-to-value) ≤ 70%, DSCR ≥ 1.30, developer gross margin ≥ 18%
- Pre-marketing: 30-50% of lots sold before launch releases the credit tranches + secures the margin
- Critical assumptions: sale price, absorption speed, finance rate, duration, cumulative finance costs
1. The 3 pillars of the financing structure
1.1 Equity (own funds)
The developer's own equity (share capital + partner current accounts) typically finances 15-30% of the total cost. It mainly serves to acquire the land and finance the upstream studies (architect, engineering office, soil studies, permits). It is the banks' requirement for granting their credit.
1.2 Bank debt (developer loan)
The developer loan is typically drawn down in tranches according to progress (earthworks, structural works, second-fix, finishes) and according to the pace of pre-marketing. 2026 rate: 4.5-6.5% depending on the bank and the developer's profile. Duration: 24-48 months aligned with the project duration.
1.3 Pre-marketing
The buyers' first deposits (in off-plan/VEFA, typically 10-30% at signing of the promise) finance part of the works as the calls for funds proceed. Pre-marketing at 30-50% before launch releases the last bank credit tranche and secures the overall margin.
2. The bank ratios to meet
| Ratio | Definition | Expected level |
|---|---|---|
| LTC (Loan-to-Cost) | Credit / total project cost | ≤ 65% |
| Exit LTV (Loan-to-Value) | Credit / estimated exit value | ≤ 70% |
| DSCR | Cash flow / debt service | ≥ 1.30 |
| Developer gross margin | (Sales revenue − total cost) / revenue | ≥ 18% |
| Pre-marketing at start of structural works | Lots sold / lots to sell | ≥ 30% |
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3. Case study — mixed subdivision + construction project, Casa Aïn Sebaâ
Hybrid project on an 8,000 sq m plot in Aïn Sebaâ, Casablanca: (1) subdivision of 18 lots (3,000 sq m of the plot), (2) construction of a residence of 32 apartments (5,000 sq m of floor area) on the other part. Project duration 30 months.
Calculated ratios: LTC = 54 / 96.7 = 55.8% ✓ · Gross margin = (sales revenue 132 M − cost 96.7 M) / 132 M = 26.7% ✓. Pre-marketing at the start of structural works: 22/50 lots/apartments = 44% ✓.
Financing structure for your development project
Land charge study + sources-and-uses table + sensitivity scenarios · Bankable report
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