A growing childcare centre had started expanding its premises from a 74-place facility into a 160-place centre.

But, with construction 75% complete, they discovered that their initial budget was critically flawed by incorrect estimates and overlooked regulatory changes. This led to a staggering 30% cost blowout. Their lender would not cover the overruns, leaving the owner without the funds to pay trades and cover escalating costs.

The owner now faced the very real risk of having to operate below capacity for another three years – a situation that would make it impossible to service their loans or grow the business.

That’s when Ligo Finance stepped in.

We helped refinance the client’s residential loan, which meant they got a cash injection of $1.9 million directly into their account to complete construction. This was part of a larger$3.9 million low-doc loan – a big win for the owner, as traditional lenders are often reluctant to provide funding mid-construction.

Plus, the loan was interest-only, which reduced the client’s monthly financial burden and instantly improved their cashflow during a critical period.

Thanks to this, the centre was completed intime for peak enrolments over December and January.

Once construction was completed, were turned to refinance the full debt with a major lender. We were now able to secure the loan against the value of the childcare centre and release the client’s home from the loan.

Under their new loan, the owner now saves $150,000 annually in interest and has significantly boosted their monthly cashflow. As part of this strategy, we were even able to negotiate future cash-outs of up to $2 million based on the center’s occupancy numbers. This will provide substantial capital for future investments and further acquisitions.

Need funding to complete your childcare project? Talk to us about finance options that reflect the realities of your business. Contact Ligo Finance today.