SME FINANCE SOLUTIONS

The core of our focus is providing you with finance for your formal business. We structure unique, individualised financing solutions using shareholder loans, equity, royalties and term loans – or any combination of these. We pride ourselves on having developed a range of finance products offering maximum flexibility to suit your specific needs.

BUSINESS FINANCE

We provide business finance ranging from R500 000 to R50 million to established entrepreneurs with a viable formal business. Finance can be used for expansion, working capital, equipment, takeovers, property, franchises, property finance for owner occupied businesses, revamps, or management buy-outs.

  • We only finance viable formally registered small and medium enterprises.
  • We only provide finance between R500 000 and R50 million.
  • Each application is considered on its merits and on the potential profitability of the business.

See below for a list of businesses we do not finance.

  1. Our first assessment is based on the cash flow viability and potential of the business, the product/service and its market acceptability, market size, the gearing of the business – debt to capital ratio of the business which influences its ability to exist and grow, the business’ track record, the stage of its development and medium to long-term profit potential, technical aspects, location of the business. This makes us different from most traditional financiers, particularly banks, who focus on security (the extent of the owner’s equity and collateral).
  2. Our next assessment is on the entrepreneur – we evaluate their technical and management skills and experience, credit worthiness, their business acumen – their ability to run a successful business on sound business principles and their personal principles such as integrity, drive and vision.

  1. We negotiate pricing and repayment terms with you.
  2. We structure personalised business finance solutions.
  3. We negotiate and agree on the pricing of the business loan during the initial financing discussions.
  4. We negotiate and agree on the repayment period during the initial financing discussions.
  5. The usual repayment period is between three to five years.

We do not finance on-lending activities, direct farming operations, underground mining, informal and micro enterprises and non-profit organisations.

5 years on average.

R500 000 to R50 million.

There is no minimum set for own contribution however, the gearing and other factors that affect the viability of a transaction are be taken into consideration.

Completed application.
Business plan.
Annual financial statements.
Up to date management accounts.
Cash flow forecast.
CV of business owner/s.

If you are an established entrepreneur, apply today to obtain finance tailored to your individual requirements.

WE FINANCE ESTABLISHED ENTREPRENEURS

Because we understand the challenges business owners face, we take more risk and finance more established entrepreneurs than most financiers.

Watch this video to learn why you should choose us over other financiers

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UP TO 100% COMMERCIAL PROPERTY FINANCE

Watch this video to learn why you should own your business premises

PROPERTY FUND

Our Property Fund caters to established entrepreneurs with a viable business who want to refinance or purchase their own premises, but may have limited capital or security to contribute, or may not want to compromise the business’ cash resources for the deposit. We also finance Residential property developments, Properties for student accommodation and Commercial property developments. You should choose our commercial property finance because:

  • In most cases, conventional financiers require a cash deposit before considering financing a property deal. The deposit amount depends on the risk appetite of the financier and deposits of up to 50% may be required.
  • We allow the business owner a choice of different financing options and can structure the deal by advancing up to 110% of the financing required, subject to terms and conditions.

  1. The underlying business must be proven to be viable and been in existence for no less than two years.
  2. The business should have a sound financial track record.
  3. The business must occupy at least 50% of the property to be purchased.
  4. The property to be purchased should be in a good condition, well located and be available at a reasonable market value.
  5. The operating business should meet affordability expectations.

We do not finance residential (homes for own use), and agriculture properties.

A maximum of 10 years.

R500 000 to R50 million.

Own contribution is not required.

Completed application.
Business plan.
Annual financial statements of the underlying business.
Details of the proposed property.

PROPERTY JOINT VENTURE FUND

Our Property Joint Venture Fund provides finance to established entrepreneurs looking to add multi- tenanted properties to their investment portfolio. We do this because we understand that multi-tenanted properties provide both capital appreciation and a rental income.

We co-invest in multi-tenanted property projects mainly in two instances:

  1. When a potential investor (established entrepreneur) is unable or unwilling to invest the full deposit (equity) required by a commercial lending institution.
  2. Where a viable property investment has been over-geared and needs a restructuring of the existing debt, converting debt finance to equity finance.

  1. Property investments in sustainable areas offering good growth and/or return on investment, preferably in metropolitan areas.
  2. Retail, industrial, and commercial multi-tenanted properties with a value of between R2 million and R120 million.
  3. Properties that require reconfiguration or upgrades.
  4. Cut-up-and-sell properties and industrial leasebacks.
  5. The prospective property investor may choose to either have an active role or be a passive investor.

We do not finance residential properties (homes for own use), agricultural properties, and mines.

A maximum of 10 years.

R500 000 to R50 million.

A proportionate share of the equity will be required and will influence the shareholding percentage.

Completed application.
Details of the property and supporting documentation.
The business owners’ latest personal assets and liabilities.

If you are an established entrepreneur, apply today to obtain up to 100% commercial property finance.

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GREEN BUILDINGS FINANCE PROGRAMME

GET FINANCE TO BUILD IT GREEN. MAKE IT GREEN.

We are proud to introduce our Green Buildings Finance Programme.

Our Green Buildings Finance Programme provides up to 100% property finance ranging from R500 000 to R50 million to established entrepreneurs with a viable business who want to invest in green buildings and achieve green building certification. We finance the purchase, construction, and/or retrofit of buildings if their designs are certified under an eligible green building certification. Our main focus is on industrial and retail spaces. For the information brochure: Click here.

Benefits of the Green Buildings Finance Programme

Our Green Buildings Finance Programme provides the following benefits to the business owner, which lower the cost of greening and reduce the payback period for the greening spend:

  • 100% property finance cost.
  • 100% of the capital expenditure cost to green the building (capped at 4.5% of the total cost of the building). The rebate will be credited to the client’s property loan account.
  • 10% legal and transfer duties.
  • A 40% rebate of the capital expenditure to green the building (40% of 4.5%) credited to the property loan account on achievement of final certification.
  • A non-refundable grant of R150 000 to cover the cost of green building certification and audit.

Properties qualifying for Green Buildings Finance

The following properties qualify for finance; the finance is subject to the business owner providing the eligible green building certification.

Hotels for which loan applications stipulate construction plans consistent with 1, 2, or 3-star hotels and 4-star rated business hotels, as defined by South African regulations, Zagat, TripAdvisor, Hotels.com or similarly well-established rating system.

All industrial buildings including warehouses – the assumption is that this building type does not have a luxury segment nor incorporate exclusions from the other building types.

The mixed use building must not include any of the excluded elements from the other building types, for example, residential townhouse development with property values above R4 200 000 (R4.2 million).

  • The adoption of green building practices is steadily increasing across the world.
  • The cost of going green is reducing.
  • Going green leads to reduced operating costs in the medium to long term.
  • Many in the property industry recognise the indirect benefits of going green: from improved wellness of building occupants, energy security to contributing to the environment.

Green buildings practices are not only about saving the planet.
Green buildings practices make business sense.

  • Offices with a value of R15 300 and below per square meter (m²).
  • Hospital and educational establishments focused on the domestic market only.

  • Residential townhouse development with a property value of R4.2 million and below.
  • Residential/apartment high rise development with a property value of R4.2 million and below.
  • Residential/detached development with a property value of R4.2 million and below.

  • Shopping centre developments with a value of R19 050 and below per square meter (m²).

Eligible Green Buildings Certifications

These green buildings certifications are eligible however documented evidence should be submitted for each: BREEAM, EDGE, GREEN STAR, LEED.

BREEAM certificate, together with BREEAM completed/approved credit checklist, and:

  1. Under ‘Ene 01 Credit: Reduction of energy use and carbon emissions’, a minimum of 6 credit points out of total 15 points must be achieved.

EDGE certificate

GREEN STAR certificate, together with Green Star completed/approved credit checklist, provided 20% improvement in energy is substantiated, and:

  1. For Green Star New Building & Major Refurbishments Retail, Office, Education & Public Building: under Ene-1 Greenhouse Gas Emissions Compliance route 1 – energy modelling, minimum of 4 credit points out of a total 20 points must be achieved.
  2. For Green & Major Refurbishments Multi Unit Residential: under Ene-1 Star New Building Greenhouse Gas Emissions Compliance route 1 – energy modelling, minimum of 3 credit points out of a total 10 points must be achieved.

LEED certificate, together with LEED completed/approved credit checklist, and;

  1. For LEED V3 BD+C 2009 New construction “New Buildings”: under ‘EAc1 Optimize energy performance’, a minimum of 5 credit points out of total 19 points must be achieved.
  2. For LEED V3 BD+C 2009 New construction “Existing building renovations”: under ‘EAc1 Optimize energy performance’, a minimum of 7 credit points out of total 19 points must be achieved.
  3. For LEED V4 BD+C : under ‘EAc1 Optimize energy performance’, a minimum of 8 credit points out of total 18 points must be achieved.
  4. For LEED V3 BD+C 2009 Core and Shell “New Buildings”: under ‘EAc1 Optimize energy performance’, a minimum of 7 credit points out of total 21 points must be achieved.
  5. For LEED V3 BD+C 2009 Core and Shell “Existing building renovations”: under ‘EAc1 Optimize energy performance’, a minimum of 9 credit points out of total 21 points must be achieved.
  6. For LEED Homes V4 EA Credit: under ‘Annual energy use’, a minimum of 15 credit points out of a total 29 points must be achieved.

Exclusions

We do not provide finance for:

  • Refinancing purposes, except in the cases where the finance will be used specifically to convert developments to meet the criteria for eligible buildings and to be certified under an Eligible Green Building Certification.
  • 5-star hotels and 4-star resort hotels.

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