Basalt Ridge Developments Ltd
RESIDENTIAL DEVELOPMENT · CHRISTCHURCH
A townhouse developer with six completed projects in eight years, all funded by a second-tier lender whose pricing he calls a tax on not being known. New to this bank, with a polished deck and two other banks reading it.
Basalt Ridge Developments Ltd is a fictional construction. The figures, relationships and decisions on this page are illustrative — built for teaching, not drawn from any real borrower or transaction.
// WHAT WAS ASKED
- Requested
- US$8.5m senior debt
- Project
- 24 townhouses, land already settled
- Loan to cost
- 55% of total development cost
- Timing
- Two other banks have the deck
- Presales
- 40%, against a 60% policy
- Claimed ROE
- 28% across six projects, unverified
- Build contingency
- 3.5%
- Suburb median price
- Down 4% in six months
// WHAT THE BANK DID
Offered the relationship rather than this deal: a smaller first project, or this one at materially lower leverage, priced so that both sides get to the next six.
The reasoning is in the file itself — the four options that were on the table, how readers answered, and the senior banker's read of the same numbers.
// READ FROM OTHER CHAIRS
The same file, and the same week, from the chairs of the people on the other side of it.
Nothing further is recorded here about Basalt Ridge Developments. This record holds published files only — when the business next appears in an issue, its entry grows.