Why is raising capital for property development still so difficult?
I just came back from a family gathering where I met up with some old friends, and we ended up talking about a lot of things. That was where I heard some of my developer friends explaining how difficult it can be to get their projects funded, while at the same time, there are investors sitting on cash looking for decent opportunities.
Obviously, the risk is not the same, and investors are not going to put money into every development.
But after we finished talking, a few questions came to my mind. Is the problem partly the way these opportunities are packaged?
Would a more transparent structure showing the underlying asset, development economics, ownership, risks, cash flows, and investor rights make it easier to connect capital with good projects? Or is the real bottleneck simply that property development is too risky right now?