The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Real estate developers will have “a really difficult time” selling their developments without in-house financing, The Balmoral’s principal told Tribune Business, adding that he was set to launch another $2-$3 million phase within four months.

Noting that 70 per cent of his last 10 buyers required in-house financing, Jason Kinsale said they represented “the sales we would have lost” had The Balmoral not offered it.

Speaking recently to this newspaper, and ahead of this weekend’s open house at which The Balmoral is offering interest rates at 5.9 per cent in an effort to move its remaining three units, Mr Kinsale said the development had decided “to get aggressive”.

He added that the Sanford Drive-based project, which is now constructing its 92nd unit, was now on “the home stretch” in terms of achieving its 130-property, full build-out target.

Mr Kinsale disclosed that The Balmoral was set to begin construction on the next phase within 90-120 days, scheduling another 12-18 units for completion.

And, while some 125 construction workmen were currently employed at The Balmoral, he said he wanted “to employ more”.

Explaining the rationale behind the weekend’s open house, and 5.9 per cent interest rate offer, Mr Kinsale said that together they were designed to create ‘urgency’ for buyers and given them a reason to ‘purchase now’.

“This promotion applies to the units we are particularly trying to sell right now,” he told Tribune Business. “We decided to get aggressive and address the biggest issue most people have right now - financing.

“We’ve already got a response to our in-house financing, and it seems to be gaining some traction. It’s important that we offer it. If you’re not in a position to offer in-house financing, you’re going to have a really difficult time.”

Mr Kinsale added: “Seven of my last 10 buyers have gone with in-house financing. I don’t think those seven people would have bought if we did not offer in-house financing. It’s the sales we would not have got.

“We reduce the hassle, and we’ve definitely made it easier, no doubt about that.”

However, he said it was a “misconception” that commercial banks were not lending, as they were offering mortgages - but only to buyers who met their tighter lending conditions.

The Balmoral had previously offered in-house financing at 9 per cent interest, but Mr Kinsale said the development switched to 5.9 per cent some 60 days ago.

“Once we sell a few more units we will start another phase,” he added. “We have plans to start construction on another phase in some 90-120 days.

“It’s a fairly modest phase, about $2-$3 million. We have a grand total of 130 units we need to get to, so we’re on the home stretch. Our phases are blurring together now.”

Some 125 workers were still employed on construction at The Balmoral, but Mr Kinsale added: “There’s not a lot of work out there.

“It’s tough for the contractors and trades people; many are really hurting. I wish we could employ more, as they’re not finding work anywhere.”

The Balmoral’s rental market remained strong, Mr Kinsale added, while the Baha Mar project at Cable Beach was having “some impact”, though not exceptional.