Can You Fund a Property Construction Project Using Only Bank Money? What Is Actually Possible in the Australian Market in 2026

One of the most common questions we hear from developers is: "Can I fund the entire construction with bank money and keep my equity in my pocket?"

The answer is yes if holding unencumbered land, however the reality is often most properties have existing lending. Most experienced developers, who have a good eye for value and growth, can often structure projects so that the cash equity they need to inject is surprisingly low, provided the land value, project metrics and lender selection are right.

Here's how it really works.

The Reality of Bank Construction Funding

Major banks and specialist non-bank construction lenders do not fund 100% of total development cost. Typical maximum gearing sits in these bands:

• Major banks: Usually 60–70% of Total Development Cost (TDC) or 60–65% of Gross Realisation Value (GRV), whichever is lower. Strong pre-sales coverage is often required.
• Specialist non-bank lenders: Frequently 70–75% (sometimes up to 80%) of TDC or 65–70% of GRV, with more flexible pre-sale requirements.

In practice, this means a developer is still expected to contribute 20–35% equity in most cases. The critical point is what counts as equity.

Land Equity Changes the Equation

If you already own the land (or can settle the land with limited cash), its unencumbered value usually forms the bulk of the equity contribution. Many projects that appear "bank-funded only" are actually funded by:

1. Senior construction debt (the majority of the build cost)
2. Land equity already in the project
3. Minimal (or zero) additional cash from the developer

This is the closest most developers get to "using only money from the banks."

What Lenders Actually Look For

To stretch senior debt as far as possible, lenders focus on:

• Developer track record and financial strength
• Project location and product type
• Fixed-price building contract with a reputable builder
• Feasibility showing a healthy development margin (typically 18–25%+)
• Quantity Surveyor reports and realistic costings
• Pre-sales (still important for major banks; less so for some non-banks)
• Clean exit strategy (sales or refinance)

The stronger these elements, the higher the gearing a lender will support and the lower the cash equity required.

Why a Banking Tender Matters

Approaching one bank is rarely optimal. Different lenders have different risk appetites, different views on pre-sales, different maximum LVRs, and different pricing.

Running a structured banking tender across major banks and specialist non-bank construction lenders almost always produces a better outcome, higher debt, lower cash equity requirement, better pricing, or more flexible conditions. In many cases the difference is material.

At Glenclair we regularly see projects where the first bank approached offered 60–65% gearing, while a competitive process delivered 70–75% with more workable terms.

When Pure Senior Debt Isn't Enough

Some projects still need a second layer of capital. This is where mezzanine finance or preferred equity sits behind the senior facility. While more expensive, it can reduce the cash equity the developer has to contribute and keep the project moving.

The decision is commercial: is the cost of the extra layer cheaper than the opportunity cost of locking up more of your own capital?

Bottom Line

True 100% bank-funded construction with zero equity is extremely rare. What is achievable for the right project and the right developer is high senior debt combined with land equity, resulting in very little (or sometimes zero) additional cash outlay.

The difference between a good outcome and a frustrating one usually comes down to how the deal is structured and which lenders are approached.

If you are assessing a construction or development project and want to understand the maximum senior debt available, we can run a confidential market process across the full panel of lenders.

Glenclair is an independent commercial finance brokerage specialising in construction and development funding. We run competitive banking tenders across 60+ lenders to secure the strongest possible terms for our clients.

Want to test the market on your next project? Book a free, no-obligation consultation and we'll assess the maximum senior debt available for your site.