Forward Funding

Real estate development may also be financed by the technique of “forward funding”.

What is Forward Funding?

In such a case, a fund usually acquires land from a developer subject to a pre-let but where the development has not been carried out. The developer will construct development paid for by the fund with an additional, profit-related, payment to the developer at completion assuming all has gone well. Properly structured, this can be tax efficient.

Our Real Estate and Construction teams are adept at transactions of this nature.