Government Funding For Property Development

Research & Development Grant Loan And Funding Programs Mentor Works Can Write For Your Business

Research and development activities support innovation and enable Canadian companies to achieve competitive advantages over other domestic and international firms. These types of activities are not just for research-focused companies and large businesses with substantial R& D budgets, but also for smaller companies that seek an edge over products and services that currently dominate the market. Innovation is a mindset that businesses must adopt to remain a viable choice to customers without research and development, there will eventually be solutions available to your client base that are more appealing than your offerings. Fortunately, Canadian government funding is available to offset R& D costs and help companies stretch their research budgets.

Mentor Works team of Canadian government grant & loan application writers have an average success rate of 86% across all government funding programs and provide our clients with an average of 95% time savings. Speak with a member of our team to find out what programs your business may be eligible for by calling us at or visiting our Get Funding Help page.

Use the filtering options below to help sort the available Canadian government funding programs.

Role Of The Big Banks

It would be unfair to say that high street banks have left the UK development finance market but their appetite has certainly diminished. The new route for high street banks appears to be the direct funding of specialist operations, offering them the best of both worlds. They are still extremely strong in areas such as term loans, buy to let, etc, but rigid deal structures and extended negotiating periods have reduced their competitive edge in development finance.

In many ways, the high street banks come into their own further down the financing chain. Once a development has been completed the next stage is refinancing enter the high street banks. By entering the process towards its conclusion this reduces their risk profile although it also decreases their potential returns. You could argue this perfectly fits their new risk-averse profile in light of the 2008 US mortgage market collapse.

Promoting Your Game In Foreign Markets: Canexport Sme

The CanExport SME program can help your video game studio conduct marketing activities in foreign markets outside of Canada by accessing CanExport grants for related projects.

Amount: Up to 50% of project expenses to a maximum of $50,000 in grants.

Eligible Businesses: For-profit businesses must be incorporated for more than three years, less than 500 employees, and have between $100,000-$100M in Canadian annual revenue.

Eligible Projects: Market research, IP/product certifications, marketing tools, and website SEO. Trade show and travel related costs for new markets, however these costs are ineligible if there is a travel advisory in those markets.

This program will open in January 2022 and will fund projects starting after April 1, 2022. All eligible costs must be incurred after approval. It can take up to 60 days to receive a verdict on submitted applications.

Learn more about the CanExport SME program.

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Canadian Federal Funding Programs For Video Game Development

Most video game developers will have one or multiple games being worked on at any given time and can cost anywhere from $500 to $300,000,000 to develop. With the cost of developing video games varying so greatly, its no wonder why government funding incentives exist help with the creation process and increase the scope and polish of games of all sizes. Canadian federal government funding programs exist and the following section focuses on the top incentives.

Paid Release Time Grant

The Paid Release Time Grant provides licensed child care programs with funding that allows their certified educators to be paid while studying, completing post-secondary coursework, and attending workshops or conferences that have been approved for professional development funding.

The grant will apply only to those courses, workshops and conferences that take place on or after September 1, 2021.

Eligibility

This grant is for Early Childhood Educators who are paid employees of licensed child care programs or family day home program educators working under licensed family day home agencies who:

• are eligible for the professional development grant, and
• paid for or enrolled in a post-secondary course, workshop or conference that is approved for the professional development grant and takes place on or after September 1, 2021.

To receive the paid release time grant, you need to fill out the relevant section in the Professional Development Funding Request form.

Funding rates

Table 3. Rate of payment to program per Early Childhood Educator.

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Funding Options To Become A Property Developer

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Becoming a property developer can appear to be a relatively easy way to make a lot of money with little experience. Simply buy a few flats, houses or other buildings, do them up and rent out or sell on for a lot more than the initial price.

In fact, there is a lot more involved in the practice of becoming a successful property developer. For starters, you’ll need a lot of starting capital to purchase properties. If you dont have enough money outright, you need to be in a stable financial position to secure funding.

Thankfully, there are many different funding options available for property development that are worth exploring

Role Of Specialist Lenders

As we touched on above, specialist lenders filled the vacuum left by high street banks when they reduce their exposure to the UK property development finance market. Specialist lenders are able to create bespoke packages structured in a fashion which is both efficient and cost-effective. In many ways, it is dangerous to compare bespoke development finance offers against the one size fits all/off-the-shelf service offered by traditional banks.

Other important factors associated with specialist lenders are an ability to be nimble, quick thinking, open to new and innovative financial structures and able to bring deals together quickly, sometimes within 48 hours. The risk-averse nature of European banks ensures the lions share of the business is funnelled back towards the UK market.

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The Public Works Loan Board

Funding for private homebuilding projects initiated by public authorities and parish and community councils is available through the Public Works Loan Board . This is a statutory body that is part of the UK Debt Management Office , which is an Executive Agency of the Treasury.

The PWLB has powers to lend money to local authorities and other prescribed bodies. The money is provided by Act of Parliament, drawn from the National Loans Fund and rates of interest are determined by the Treasury.

The following public sector organisations are eligible all English county and district councils, the counties and county boroughs in Wales, the London boroughs, the Common Council of the City of London, the Greater London Authority and its functional bodies, the councils of local government areas in Scotland, the Council of the Isles of Scilly, the Broads Authority and the National Park authorities.

Parish councils are also eligible, but need borrowing approval from the Department for Communities and Local Government. They can seek this by approaching their County Association of Local Councils or, in the case of community councils in Wales, the Welsh Government.

Two types of loan are available:

Interest rates are determined by the DMO. Discretionary Rate Discounts are also available.

A General Overview Of Development Finance Market

Historically the cost of short-term finance was anywhere between 12% and 14%. This was a time when high street banks had a monopoly on all areas of the finance market. This has changed dramatically since 2008 and the US sub-prime mortgage crash which weakened bank balance sheets, leading to reduced risk profiles. While high street banks have not completely removed themselves from the development finance UK market, they are not as competitive as their specialist counterparts.

The rate for high street development finance is generally between 4% and 4.5% with specialist financiers operating between 6% and 6.5%. The major difference is that specialist finance companies will lend up to 75% of the gross development value as opposed to just 50% for high street banks. The approval timescales are also very different high street banks can take between six and eight weeks while some specialist development finance companies can have provisional offers in place within 48 hours.

The UK development finance market covers a whole range of different investment opportunities from pre-planning permission developments to large redevelopments and everything in between. Housing developments have recently attracted more than their fair share of interest of late as the UK government continues to push for more affordable homes. There is currently a shortfall of around 300,000 new homes across the UK. This has attracted the attention of private property developers as well as housing associations .

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Property Funding Development For Smaller Business

If you have a commercial mortgage already, you may be able to secure additional funding for development work, but this will again be contingent upon LTV as well as your track record and experience.

Bridging loans are a shorter-term option if the proposed work is considered to be fairly ‘light’, but depending on the appetite of your lender development finance may be the way forward for more significant projects. To secure this, you will need a clearly defined development programme and budget, as well as a strong idea of the market you are operating in, potential future income/value, and an understanding of whether you intend to retain the development or sell it.

Rising construction costs and a shortage of labour are current issues facing construction. Lenders will look to ensure that there is an appropriate level of cost contingency in your budget and that you have sufficient equity to meet any cost overruns.

Many contractors working with very small profit margins on contracts and revisions under the building contract may increase costs. Contractors may also have several projects underway, and you will need to satisfy yourself that the contractor is sufficiently strong financially and in terms of resource to manage all.

Property Development Finance In Practice

Depending on the type of project you want to embark on, thereâs a world of finance options available. You might want a ‘refurbishment bridge’, which funds 3â24 months of building costs and sometimes comes with the option to convert into a mortgage later on. This type of product would cover the majority of light and heavy refurbs.

Then for more extensive projects and ground-up developments, you can find ‘development finance’ to cover both land purchase and building costs. For example, if a developer wants to buy a plot of land for £100,000 and spend another £500,000 building properties on it, a lender might finance 50% of the plot purchase and 70% of the build.

In this example that would mean the developer would only need £200,000 of their own money, rather than the total of £600,000 that the whole project costs â freeing up their personal capital for other projects, or unexpected expenses.

Experienced developers who act as landlords can also use property they already own to secure lending. With enough equity free in your portfolio, you can get finance to buy more properties â allowing you to grow your property portfolio without having liquid cash.

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Fund The Development Appropriately

There are different ways to structure the finance for development projects. Solutions are flexible â they can work to different build schedules and different abilities to make repayments. A common option is to use short-term finance for purchase and build costs, commonly referred to by lenders as bridging finance, and then ‘exit’ into a longer term loan or commercial mortgage.

There are many competitive lenders in this market with different appetites for lending, according to geography and the development project at hand. However, bear in mind youâll need an ‘exit’ planned from these short-term loans, such as selling the property or a refinance onto a long-term mortgage. We can help discuss these options as the application moves forward.

Emergency Capital Repair Grant

The Emergency Capital Repair Grant is provided by the U.S. Department of Housing and Urban Development to family housing property owners to enable them to carry out emergency repairs. This is a crucial one in the government grants for investment properties as these funds are used to tackle anything that can impact the safety and health of the tenants. Examples of repairs allowed include any structural components in critical condition and replacement of mechanical equipment. Individual investors can apply to the HUD for these funds up to a maximum allowed amount for this grant $500,000. Your housing project should serve a useful purpose for the community or the neighborhood where it is located as a requirement for compliance.

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Uk: Building Safety Government Starts To Detail Its Approach To Developer Funding

The Government has recently published details of its plans to”reset” its approach to remediation of buildings between11m and 18m tall, following the Secretary of State’s initialannouncement on 10 January 2022 .

On 3 February 2022, the Department for Levelling Up, Housing andCommunities wrote a further open letter to residential propertydevelopers setting out its proposed “Heads of Terms” fora proposed “legally binding” agreement between theGovernment and developers. The draft “Heads of Terms” areset out in the letter and, broadly, they comprise of:

• A commitment by each individual developer to remediate thosebuildings which they themselves played a role in developing orrefurbishing. This includes buildings where defects have not yetbeen identified but are discovered in the future – meaning that theextent of any individual developer’s liability may yet beunquantifiable and
• A commitment to provide financial contributions towards a fundwhich will cover the costs of remediating cladding defects on allother 11-18m buildings .

In each case, the scheme will cover buildings which have beenbuilt or refurbished within the last 30 years. While further workis still needed to develop the mechanics of the scheme, the basicprinciples set out in the letter include:

The sizing of each developer’s contribution will be based onits historical profits “or other market metric”, which isstill to be defined.

Read the original article on GowlingWLG.com

Send In Your Application

Save a copy of the grant application form for your records. Then send it using one of the following methods:

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Current And Upcoming Funding Opportunities

Open to applicants that meet eligibility criteria. Consult funding opportunities for more information on eligibility criteria.

• The information from this list may change.

Funding For Video Game Development: Canada Media Funds Experimental Stream

The Canada Media Funds Experimental Stream helps to support Canadian-made interactive software through its conceptualization, prototyping, production, and marketing funding phases that support these various stages of the product development lifecycle. The funding provided through this is a loan and will need to be paid back to the Canada Media Fund through a portion of revenue, which is determined by the stream of funding being utilized.

Amount: This program funds up to 50-75% of eligible project costs to a maximum of $15,000-$1.5 million. Each phase of a project has a different maximum amount of funding associated with it:

The overall maximum amount a single project can access across all funding streams is $1.5 million.

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How To Choose The Right Government Funding Option

Here are some questions you can ask yourself to see which government funding options are right for you and your business.

• How much money do you need?
• When do you need the money?
• What will the money be used for?
• What types of funding options would you accept?
• Can you meet the minimum requirements for the fund?

Hot Tip

Whats Important To Lenders

Even though the specialist UK development finance market is fast-moving and ever-changing, there are still basic elements which are important to lenders. However, sometimes it is useful to take a slightly different approach to affordability and work back from possible exit routes. We know that exit routes could be refinanced, outright sale or a phased sale over 12 or 18 months, but is the original deal affordable and returns acceptable?

Some of the more traditional elements which lenders will review include development experience, GDV, collateral and the quality of third-party contractors. There also needs to be an incentive for an investor to succeed, often measured by the amount of personal capital invested. Here at Enness, we have vast experience in specialist finance which means flexibility on the structure and very few hurdles which cannot be overcome.

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