Developers may choose to reduce their cash contribution and utilise preferred equity, allowing them to take advantage of other simultaneous opportunities.

Mezzanine is a hybrid of debt and equity and is offered at a higher rate of interest due to its expediency and risk. Most successful developers use mezzanine finance once their projects have de-risked with DA and pre-sales achieved. However, mezzanine finance can be used to fund land settlement, finalise design and approvals or to fund sales and marketing to achieve pre-sales.