We keep hearing the same story:
“Great project, strong GDV, solid demand… but we’ve run out of cash.”
In property development, the wreckage rarely lies in the vision. It lies in the gaps between milestones—in the cash flow trenches, not the master plan.
The Myth of the Endgame
Too many developers are still building to an end value dream while living in a present-day liquidity nightmare.
Yes, the GDV (Gross Development Value) may stack. But value on paper doesn’t pay subcontractors, fund material inflation, or cover that second drawdown delay.
Let’s be clear:
Property development isn’t just about margin. It’s about stamina.
The developers that survive are the ones that stay funded—not the ones with the most exciting brochure.
Three uncomfortable truths developers (and their advisors) need to face:
- The funding structure is broken.
Traditional funding models—over-leveraged, under-sequenced, overly optimistic—are exposing projects to collapse halfway through. Senior lenders are nervous. Mezz is expensive. And bridging is often a gamble. - Cash burn is faster and nastier than ever.
Inflation hasn’t just affected build costs—it’s destroyed contingencies and messed with scheduling. If your forecast wasn’t ripped up and rebuilt this year, you’re already behind. - Economic sentiment is your biggest risk.
Sales timelines are slipping. Buyers are cautious. Funding cycles are tightening. That “comfortable 10% buffer” isn’t just gone—it was never enough.
So what do you do?
Developers and advisors need to shift their mindset from “How do I finish the build?” to:
“How do I survive to finish the build?”
This means:
- Reforecasting cash flow monthly, not quarterly
- Creating real liquidity plans for worst-case sales scenarios
- Engaging restructuring and funding advisors before you run out of time
- Asking: “If I had to sell today, could I cover my commitments?”
The tough leadership question:
If you had to personally fund the next phase of your project, would you still be so confident in your risk model?
Final Thought:
Property development doesn’t die with poor returns. It dies with no cash to get to the finish line.
Let’s stop pretending otherwise.
It’s time to fund the gap—not just the dream.
