Killarney Capital is a privately owned specialist property finance business focused on helping developers and investors get quality projects moving. With a responsive, relationship-led approach, Killarney provides practical funding solutions across development, bridging and other property-backed lending. The team combines banking experience with commercial flexibility, working closely with clients, advisers and project partners to structure finance that fits the deal. Killarney is known for being honest, fast-moving, reasonable and committed to helping clients succeed.
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Avanti Finance is an award-winning specialist lender that’s been helping New Zealanders achieve their financial goals for more than 37 years.
Through our trusted network of advisers and brokers, we offer a comprehensive range of tailored lending solutions – including property lending across long- and short-term mortgages, bridging and caveat loans, investment and development finance, and commercial property funding. We also support customers with auto, personal and business loans.
We focus on understanding each situation and delivering lending solutions that work – for our customers and the partners who support them.
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First Mortgage Trust (FMT) is an investment fund manager specialising in property finance. For 30 years, FMT has been helping New Zealanders protect and grow their wealth by providing consistent investment returns. Today, the company has over $2 billion in funds under management and more than 7,500 investors nationwide. FMT also provides mortgage advisers and clients with tailored property finance through first mortgages across the residential, commercial, industrial, construction and development sectors in New Zealand. FMT has offices in Auckland, Tauranga, Wellington and Christchurch, with over 70 staff members, and is continuing to grow to meet market demand.
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If Jane Austen were a mortgage adviser in New Zealand today, she might feel oddly at home.
Austen was an expert in unrequited ballroom romances – the quiet hopes, the nervous preparation, the terror of public embarrassment. She understood rooms where everything was in place for something to happen, and yet little did: the musicians tuned, the candles lit, the floor full of people who had come expressly to dance – but were thwarted.
New Zealand’s development finance market in mid-2026 has precisely this quality. Capital has arrived in quantity – offshore money, specialist non-bank lenders, a widening pool of private funding – all dressed,
present and willing. Developers are here too, with sites in hand, projects that need funding. And still the floor is quieter than it should be. Geopolitical shocks, the slow creep of building costs, a looming upward rate cycle. An election also offers, as one lender says, “an opportunity [for people] to sit on their hands just a little bit longer”.
Casey Williams, general manager of Killarney Capital, puts it this way: “For the last few months, the market has felt a bit like everyone is standing near the dance floor waiting for someone else to make the first move.”
What Austen also understood, of course, is that the most interesting thing about a hesitant ballroom is not who is waiting – it’s who eventually crosses the floor and who engineers that crossing. The partners who find each other in this market don’t dance by accident. Like in an Austen ballroom, friends and chaperones understand which nascent partnerships have a chance at success, even if the principals themselves sometimes don’t. The right project has been introduced to the right funder by an adviser who can read the signs of compatibility.
New Zealand’s development finance market is in selective recovery – the capital is there, lenders are willing, and building consents are up, but the deals getting funded are only those with
credible sponsors, sound structures and realistic exits, which means that for mortgage advisers working with developer clients, the ability to read the room and make the right introduction has rarely been more valuable.
Green shoots, or just weeds? Robin Hopkins, Avanti Finance’s general manager for property development and business lending, agrees the mood is rather cautious. “Overall, the market remains subdued,” he says. “We were starting to see green shoots coming through prior to the recent geopolitical tension in the Middle East, which has unfortunately dampened confidence once again.”
Despite that, he notes a quiet positive: the developers that are moving are the ones you want to see moving. “We’re definitely seeing a growing number of experienced developers bringing projects to market, which is a positive signal for the sector,” he says.
He adds that some larger transactions are also appearing. “It’s also encouraging to see more jumbo deals coming to the market – slightly larger developments, typically ranging between 20 to 50 houses in prime locations, which align well with Avanti’s target market and appetite.”
Phil Bennett, head of lending at First Mortgage Trust (FMT), frames 2026 as a “transition year” with “early recovery, but … uneven confidence”. He points to building consents being up 11% year-on-year as a sign that the pipeline is real. The opportunity, in his view, is targeted: “smaller, simpler and staged risk”, he says, particularly “low- to medium-density residential terrace, turnkey, stand-alone stuff”.
Large apartment exposures remain difficult. “Mainstream banks still want pre-sales, and we have to think about that in demand,” says Bennett.
The shifts around pre-sales One of the more significant shifts in the market is the quiet death of the pre-sale as a near-universal requirement. Williams describes what has taken its place: “Funders are increasingly comfortable relying on residual loan-to-value ratios and the availability of refinance or residual stock funding once the project is complete. Pre-sales still matter, but more as evidence of demand and value than as a blunt requirement.”
Hopkins explains the banking side of this shift from a practical standpoint. “It’s become increasingly difficult for purchasers to secure bank funding for homes that are yet to be built,” he says. “Main banks are often reluctant to provide that sort of progressive drawdown loan.” The result has created a different kind of opportunity. “We’ve seen a growing opportunity in turnkey funding, where we can fund a builder knowing that a purchaser has been approved by the bank.”
The absence of pre-sales is, in Hopkins’ view, both a problem and an opening. What it’s also done is push more residual stock funding into the market – developers finishing builds with unsold units who need short-term holding finance while sales come in.
Hopkins describes Avanti’s approach as relationship-first, supporting developers with seamless funding solutions across the full life cycle, from land acquisition and pre-development through to construction and post-development residual stock, often without the need for pre-sales. “We tailor solutions to meet the funding needs of each stage of a project. We’re hands-on, actively involved in the project, supporting the developer with end-to-end delivery,” he says.
Construction costs add pressure Developers and funders alike are keeping a close eye on build costs. According to the Cordell Construction Cost Index, costs peaked at roughly 10.4% annual growth in late 2022 before moderating sharply through 2023 and into 2024. By mid-2024, year-on-year growth had dropped to just 0.6%. More recently, costs have been edging back up: the March 2026 quarter recorded 3% annual growth, the highest in two years. While that is nowhere near the pandemic-era spike, it’s enough to affect feasibility models that were built on the assumption that cost pressures had fully subsided.
The prospect of a rising interest rate cycle adds to the mix. Bennett sees this playing out directly in how FMT structures deals. “We’re kind of seeing more buffers being built into projects around interest rate increases,” he says. “Certainly, there’s a bit more around construction slippage, and then anything that’s burning diesel these days needs to have a bit more buffer in it.”
This granularity is where non-bank lenders argue they earn their margin. “A lot of that analysis where we can push the leverage and we can push the lesser pre-sales is going to be just around: Have building costs been validated? Is it a quality contractor?” says Bennett.
Banks versus non-banks: not a simple story The retreat of mainstream banks from more complex development lending is well documented. But non-bank lenders know that banks remain relevant in the space; they have simply become more selective.
Williams puts it diplomatically: “Banks will always play an important role in development finance. They have scale, balance sheet strength, brand recognition and the ability to price very competitively when a deal fits neatly inside policy. They are very good at picking the low-hanging fruit: strong sponsors, clean pre-sales, conservative leverage, standard security and simple structures.”
The problem, he suggests, is structural rather than attitudinal. “The issue is that a lot of the good stuff in development finance sits a bit higher up the tree, and banks don’t let their staff climb ladders. That’s not a criticism; it’s simply how large institutions are built.”
Bennett draws on his background in mainstream banking. “The mainstream banks are probably retrenching a little bit to what I’d
describe as lower-risk or more vanilla transactions,” he says. “And I think that opens it up nicely for non-banks and private capital where they can expand into that complexity.”
He is direct about where FMT fits: “As a specialist lender, it’s growing for us. We can address complex and underserved borrower requirements, and certainly when it comes to that leverage play and that type of thing, that’s where the non-banks really come into their own.”
For advisers, Bennett frames the practical advantage in terms of execution risk. “Non-bank lending is growing, certainly driven by tightened bank criteria and more regulatory constraints,” he says, adding that the key competitive advantage for non-banks is “flexibility, speed and also judgement-based credit decisions”.
Williams frames this in dollar terms. “Time is one of the most expensive ingredients in development,” he says. “A cheaper interest rate is helpful, but not if a project loses two months waiting for an answer, misses a construction window or fails to secure a key contract. Non-bank funding may be more expensive on a headline rate basis, but if it gets a good project moving faster, the overall outcome can be better.”
Having a niche is also key for non-banks. “Avanti is uniquely positioned in the development finance market,” says Hopkins. “We support experienced developers with strong equity positions who require funding in the $5 million to $15 million range – a segment that often sits below the core focus of the main banks and above the capacity of many specialist lenders. With national coverage, we’re able to back quality projects not only in the main centres but also in regional markets where strong development opportunities are emerging.”
Capital abundance: a double-edged sword One tension that sits underneath all of this is that even as caution pervades the broader development market, the amount of capital chasing development deals has actually increased. Family offices, offshore money from Australia and a growing cohort of specialist non-bank lenders have all added to the pool of available funding.
Hopkins describes Australian capital as a feature of the current market, though with a practical caveat. “The only thing with the Australia money – it will come and often in larger chunks. What those investors need is somebody local to actually be able to do the work, assess the deals and manage the projects,” he says.
Williams is the most candid about what capital abundance can do to underwriting standards. “You could almost say there hasn’t been a better time to borrow for development since 2007 – although mentioning 2007 in finance circles is a bit like saying ‘Candyman’ three times in the mirror,” he says. “Capital has rolled into the sector like a king tide. When supply of money increases and borrower demand is patchy, lenders naturally compete harder. That’s driven higher leverage, reduced pre-sale requirements, more flexible covenants and, in some cases, pricing that would have seemed unlikely a couple of years ago.”
The risk, Williams argues, is that loose capital can encourage loose lending. His prescription is straightforward: “At Killarney, we are not trying to be the fun police, but we do believe in common-sense standards: proper due diligence, sensible equity, cost control, realistic exits and transparent reporting. We still love ‘show me the money’ energy – just preferably with a feasibility, contingency and repayment plan attached.”
Where the geography points Regionally, the picture is uneven in ways that matter for advisers sourcing deals. Christchurch and the broader South Island continue to attract strong attention. Bennett describes Christchurch as “going really strongly” and points to population growth, job opportunities and available land as the drivers. The Canterbury rebuild created a long-term demand pipeline that continues to pay out.
Queenstown now looks less like the boom-and-bust cycle it once was. Bennett describes the Queenstown market as more like a “rolling hills scenario” than the dramatic peaks and troughs of previous cycles. The Cromwell and Central Otago satellite markets around Queenstown are also absorbing demand. Hopkins works with a developer-builder client in Cromwell who “continues to experience strong growth in this market”.
Bennett also flags the Hutt Valley as a market showing signs of change, with an apparent shift away from an oversupply of terraced houses towards more stand-alone housing.
Auckland remains what Bennett calls “the centre of the universe”, with ripple effects flowing outward from any major shift there.
The product mix is also evolving. Williams offers a candid assessment of the townhouse cycle: “Over the past decade, terraced townhouses have become the development finance equivalent of a reliable workhorse.” But saturation in some markets is changing the quality bar. “In some areas, we now appear to be approaching saturation point. That doesn’t mean townhouses are finished; it means quality and liveability matter more.”
He also observes a quiet return to stand-alone product. “We’re also seeing renewed interest in stand-alone homes and lower-density product, where buyers can still get a bit of separation, even if they can just about reach out the window and pass their neighbour the barbecue tongs.”
Consenting: the cost no one talks about On planning and consenting, all three lenders share a clear frustration, even if they express it differently. The knock-on effects are not abstract. “For developers, time means holding costs, consultant costs, changing construction prices, staff and contractor uncertainty, pre-sale risk and equity tied up for longer,” Williams says. “For funders, time changes the risk profile. A feasibility that works today may look very different after 12 months of consenting delays.”
Hopkins highlights a consistency problem that plays out across regional councils. “There’s a lack of consistency amongst the local authorities in terms of time to decision, cost of consents and process,” he says. The variation is stark enough to influence where developers choose to build. “Depending on which council they’re dealing with, that could drive their decision about which project they would do.”
Bennett describes the government’s intent as broadly positive but notes that the gap between intent and reality remains material. “Policy intent is pro-supply,” he says. “The government is focused on increasing land supply, planning reform, improving construction efficiency. And some of the issues are it's still reasonably lengthy and costly around that consenting process.” More speed and efficiency, he says, would feed directly into housing affordability, not just supply.
Where it goes from here Looking ahead, the lenders each identify a version of the same structural shift: more sophisticated capital structures, more collaboration between lenders, and a growing role for data and technology in speeding up decisions.
Bennett points to blended debt-equity transactions, staged funding solutions and co-lending between banks and non-banks as the likely shape of the market going forward. “The big differentiator will be speed plus certainty,” he says, adding: “When you’re dealing with someone like FMT, you’ve got this certainty of funding across the project.”
Williams sees the integration of AI as a genuine operational shift rather than a buzzword. “At Killarney, we are already increasing how we use it across borrower and project due diligence, valuation assessment, planning and consent reviews, reporting and risk monitoring,” he says. He is clear-eyed about its limits, though. “AI is not a magic wand. It will not turn a bad feasibility into a good one, find equity hiding under the couch or make a poor location suddenly desirable.”
Hopkins points to changes in the build process itself, including prefabrication and 3D printing, as likely to reduce costs and speed up construction timelines. For lenders, that changes the risk and duration profile of development finance in ways that are still being worked out.
For advisers, Bennett’s closing thought cuts to the heart of it: “The pipeline is there, demand is stabilising, and policy is moving in the right direction. But the constraint today is certainty. Projects that are simple, well-structured and aligned to end-buyer affordability are the ones that are getting funding. Everything else requires more creativity, more capital layering and more discipline.”
Or, taking a leaf from Austen: the dance floor isn’t empty, but the music is playing differently, and knowing which lender suits which deal is one of the most useful things an adviser can know.
Published 06 Jul 2026
2022
JUN
2022
MAR
2022
SEP
2022
DEC
2023
MAR
2023
JUN
2023
SEP
2023
DEC
2024
MAR
2024
JUN
2024
SEP
2024
DEC
2025
MAR
2025
JUN
2025
SEP
2025
DEC
2026
MAR
10
8
6
4
2
0
Quarterly growth (%)
2.4
2.6
3.4
1.7
0.6
0.6
0.4
0.8
0.5
-1.1
1.1
0.6
0.3
0.6
0.4
0.9
1.0
*Q4 2012 = 100
Source: Cordell Construction Cost Index
Construction cost growth in New Zealand (2022-2026)
7.3
7.7
9.6
10.4
8.5
6.4
3.3
2.4
2.3
1.3
1.1
0.9
2.7
2.0
2.3
3.0
0.6
Quarterly growth (%)
Yearly growth (%)
Number of consents for all new dwellings
Year-on-year change
New dwelling consents rising
Feb 2026
Mar 2026
Apr 2026
37,534
37,813
39,037
+11.7%
+11.0%
+16.5%
Source: Stats NZ, Building consents issued data
“For the last few months, the market has felt a bit like everyone is standing near the dance floor waiting for someone else to make the first move”
Casey Williams,
Killarney Capital
“We tailor solutions to meet the funding needs of each stage of a project. We’re hands-on, actively involved in the project, supporting the developer with end-to-end delivery”
Robin Hopkins,
Avanti Finance
“The mainstream banks are probably retrenching a little bit to what I’d describe as lower-risk or more vanilla transactions … I think that opens it up nicely for non-banks and private capital where they can expand into that complexity”
Casey Williams
Killarney Capital
Robin Hopkins
Avanti Finance
Phil Bennett
First Mortgage Trust
Industry experts
More
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Non-bank lenders are filling the gaps in development finance as banks retreat to safer ground. For mortgage advisers working with developer clients, knowing which deal suits which funder is everything
Sense and feasibility in development finance
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Casey Williams is general manager of Killarney Capital and has more than 20 years of experience across commercial banking, credit risk, property development finance, leadership and governance. Since joining Killarney in 2018, Williams has helped drive the company’s growth within New Zealand’s specialist finance sector. Williams is passionate about helping good clients get quality property projects moving, with a practical, relationship-led approach built on speed, honesty and common sense.
Killarney Capital
Casey Williams
Robin Hopkins is Avanti Finance’s general manager for property development and business lending. He has more than 30 years of senior leadership experience across the financial services industry, spanning banking, insurance and credit management. He leads Avanti Finance’s Property Development and Business Lending division, with a strong focus on building long-term relationships and delivering tailored funding solutions for developers and business customers.
Avanti Finance
Robin Hopkins
Phil Bennett is head of lending at First Mortgage Trust (FMT). He has a wealth of experience in New Zealand’s banking sector. FMT is New Zealand’s largest specialist lender of first mortgages, providing funds for residential, commercial, industrial and rural investments and developments across the country.
First Mortgage Trust
Phil Bennett
Phil Bennett,
First Mortgage Trust