Financing a Construction Project


By: Praveen Gopal --

30 December, 2014

Financing a Construction Project

The construction sector is one of the most volatile industries and suffers greatly during economic downturns. Even though, the current economic scenario is recovering in majority of economies, lack of construction financing opportunities has been a significant factor holding back the recovery of private sector construction. The construction/project financing comes in where the builders do not have the financial means to handle high value projects. The long-term project financing of infrastructure and industrial projects is based upon the projected cash flows of the project rather than the balance sheets of its sponsors. It is very important to determine what type of project financing is required, what type of loan that is required and also have to look into loan options provided by various organizations. This whitepaper discusses the need for project financing and what are the risks associated with financing a high value projects specifically in private sector.


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