How to Find Investors for your Property Project

So, you’ve identified a promising property project, the financial projections look solid, and you’re eager to get started – but a crucial question remains: how will you finance it? For many aspiring and established property developers, securing the necessary capital is the primary hurdle.

Navigating the landscape of property finance can be complex. When your own resources aren’t sufficient to cover the entire development cost, you typically have two main avenues: securing debt financing, such as a loan, or bringing in co-investors who will receive a share of the project’s profits in exchange for their capital. 

Both approaches have distinct advantages and disadvantages, and the best choice for you will depend on the nature of your project, your risk appetite, and your long-term goals.

This updated guide will explore various strategies for finding investors for your property ventures in today’s market. We’ll delve into different types of investors and platforms, helping you understand where to focus your efforts to attract the right financial partners for your next successful development.

Friends and family

Usually the first port of call, but asking the question can be awkward. Nobody wants to compromise a friendship or cause a family rift – and you need to consider how they would react if things went wrong further down the line.

Other private investors

You’ll generally find these through your network, including the agents working on the sale. These wealthy individuals are happy to get involved in property projects, usually in locations that they know, and, once found, it’s just a matter of building a relationship with them. You can expect these investors to ask lots of questions about the project and your ability to deliver it. They’re also likely to want plenty of security, as well as a good return.

Angel investor networks

You’ll find a host of angel networks online. Typically, you submit your requirements through the website and view the profiles. You won’t have any prior relationship, and some of the investors on these sites can be quite casual, so you could find you need to submit your proposal to several networks before you get a bite.

Family offices

These are professional wealth managers protecting and growing the assets of an affluent family. They will often have an appetite for property as part of a balanced portfolio, but it’s a close-knit industry so can be hard to break into without the right contacts.

Crowdfunding platforms

There are several property-based peer-to-peer platforms on the market, some more established than others, so it’s important to check the criteria and credentials of the platform you choose. Assuming your project passes the platform’s credit checks, it will be marketed to its investors. The risk is that the project is not fully funded by its close at which point it is withdrawn from the platform and you are back to square one. Rates can be high as the platform has to offer attractive rates to investors as well as factor in its own margins and fees.

Here at LendInvest, we offer loans rather than equity through products like property development finance and bridging loans

While there are investors of various types providing the capital on the other side of our platform, they are at arm’s length and you don’t have to do the work to find them. The availability of the funding is also guaranteed for all loans that are agreed – there’s no waiting and seeing if investors will take it up. Rates are competitive and not dissimilar to those that you would expect to pay to a bank if it was to have an appetite to lend.

The common denominator is that you need an attractive and well thought through proposition that gets the balance of risk and reward right for the investor, while keeping the project profitable and attractive for you. You should be prepared to put time into it and also for a few false starts, particularly if you are seeking a large amount from one source.

So, whatever your project, review your options and decide whether equity or debt works best for you.