Introduction
In this milestone 200th episode of the Property Mastermind Podcast, Hilary Saxton and Bob Andersen unpack one of the most critical parts of a development project: your exit strategy.
Whether you’re selling, holding, refinancing, or doing a creative deal, how you exit a project has a major impact on your final profit, tax position, and long-term plans. This episode explains why you need to decide your exit strategy early, how to structure your project to support it, and what happens if you change direction midstream.
Episode Highlights
[00:00] Celebrating 200 episodes and introducing today’s topic: exit strategies in property development.
[02:28] Book giveaway shout-out to new mentoring student Chris Moore.
[03:00] Why exit strategies matter: your plan affects finance, structure, and end outcomes.
[04:15] Financiers want clarity—sell, hold, or mix? You need the answer from the start.
[06:02] Exit Strategy 1: Sell the completed development—clean, simple, and lender-friendly.
[08:05] Exit Strategy 2: Sell off the plan—pros, cons, and why timing matters.
[13:18] Exit Strategy 3: Refinance and hold—generate passive income and capital growth.
[17:20] The five-year hold: staging your exit like a mini-property trust.
[18:45] Exit Strategy 4: Creative options like stock-back deals and JV buyouts.
[21:42] Case study: 22-townhouse project using a mix of cash and finished product.
[24:36] Exit Strategy 5: Bulk sale to investors—fast, lower-margin, low-risk.
[27:00] Put-and-call options, staged settlements, and how they support flexibility.
[30:00] Creative exits only work when your structure supports them—plan ahead.
[31:13] What happens if you change your strategy mid-project? Risks and red flags.
[33:11] Tax and GST consequences of switching from sell to hold (and vice versa).
[35:22] Final tips: surround yourself with professionals who understand development.
[36:31] September’s 3-Day Workshop preview and wrap-up of episode 200.
Episode Details
Hilary:
Welcome to Episode 200 of the Property Mastermind Podcast. We’ve officially hit a milestone! Today’s topic is one that makes or breaks a project—your exit strategy. We’ll walk through the different ways you can plan to exit a development, and why planning early matters more than most people realise.
Bob:
Most people focus on how to start a project, but how you finish it is just as important—especially for your lender and your bottom line. Your financier will ask how you’re exiting. Are you selling? Holding? Refinancing? You need to have that answer from day one.
Hilary:
It’s like any journey—you wouldn’t jump in the car without knowing where you’re headed. Your exit shapes your structure, financing, and even who your end buyer is. Let’s dive into the five main strategies.
1. Sell the Completed Development
Bob:
This is the most common approach. You build, you sell, you pay back your loan, and keep the profit. Financiers prefer it because it’s clean and simple. But don’t underestimate the importance of structure—if you’re selling, the wrong entity can cost you in tax.
2. Sell Off the Plan
Hilary:
This can help reduce financial risk and make your lender feel more confident.
Bob:
It’s a legal contract with a deposit—usually 10%. The downside is if the market rises, you miss out on gains. And if you’re selling to owner-occupiers, they often want to see the finished product. Off-the-plan is more appealing to investors.
3. Refinance and Hold
Bob:
We call this “develop and hold.” You might keep one or more properties as long-term rentals and refinance to access your equity. It’s a great way to build passive income. You can even do a partial hold—sell some, keep some. But the structure must support it.
Hilary:
There’s also a “medium-term” hold—like five years before selling. This is common in property trusts and works well when you want capital growth and rental yield before selling down.
4. Joint Venture Buyout or Stock-Back Deals
Bob:
Here, you buy land with little to no cash upfront, and offer the seller finished product as part of the deal. For example, in a past project, we gave the seller two finished townhouses plus some cash at the end. That freed up capital and reduced our loan requirement.
5. Bulk Sale to Investors
Hilary:
Selling your whole project to one buyer might get you less per unit, but it saves you time, advertising, and stress.
Bob:
You de-risk the whole thing in one hit. Just make sure you’ve got strong contracts if it’s one buyer—if they fall over, it all falls over.
What Happens If You Change Strategy Mid-Project?
Hilary:
This happens. The market shifts and developers change plans. But that decision has tax and GST implications.
Bob:
The ATO looks at your original intent. If you planned to sell and then hold, you might not qualify for capital gains concessions. You could also face GST clawbacks. Always talk to a good accountant before making the switch.
Final Thoughts
Bob:
Some of this may be complex—but the key is to get educated and surround yourself with the right professionals. Structure, tax, and legal setup all depend on your chosen exit.
Hilary:
And if you’re serious about learning this stuff properly, check out our upcoming 3-Day Property Development Workshop on the Gold Coast—September 19 to 21. It’s a great way to deepen your understanding and meet others on the same path.
Bob:
We hope you found this episode helpful. Here’s to many more—see you in Episode 201.