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Forward Funding Agreement Template for New Zealand

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Key Requirements PROMPT example:

Forward Funding Agreement

"I need a Forward Funding Agreement for a sustainable retail development project in Auckland, where an overseas institutional investor will provide NZD 50 million in funding, with completion scheduled for March 2025 and specific green building certification requirements."

Document background
Forward Funding Agreements are utilized in New Zealand when institutional investors or financial institutions seek to fund property development projects from the ground up, rather than acquiring completed assets. This comprehensive agreement type is particularly relevant for large-scale commercial, retail, or industrial developments where the funder takes an active role in the development process. The Forward Funding Agreement establishes the entire framework of the development funding relationship, including land acquisition, construction funding, development obligations, and completion requirements. It must comply with New Zealand's legal framework, particularly the Property Law Act 2007, Construction Contracts Act 2002, and Financial Markets Conduct Act 2013. The document typically includes detailed provisions for drawdown mechanics, construction specifications, security arrangements, and project monitoring requirements, making it essential for significant development projects in the New Zealand market.
Suggested Sections

1. Parties: Identification of the Funder and Developer/Seller, including registered addresses and company details

2. Background: Context of the agreement, including property details and development overview

3. Definitions and Interpretation: Key terms used throughout the agreement and interpretation rules

4. Conditions Precedent: Prerequisites that must be satisfied before the agreement becomes fully effective

5. Project Description: Detailed description of the development project and specifications

6. Funding Obligations: Funder's obligations regarding the provision of funding, including timing and conditions

7. Development Obligations: Developer's obligations regarding the construction and completion of the project

8. Payment Mechanics: Process for drawdown requests, payments, and funding administration

9. Construction Requirements: Specific requirements for construction, including timelines and quality standards

10. Warranties and Representations: Standard and specific warranties from both parties

11. Monitoring and Reporting: Requirements for project monitoring and regular reporting to the Funder

12. Security: Security arrangements protecting the Funder's interests

13. Insurance: Required insurance coverage for the project and parties

14. Default and Remedies: Events of default and corresponding remedies

15. Completion and Handover: Requirements and process for practical completion and final handover

16. Dispute Resolution: Procedures for resolving disputes between parties

17. General Provisions: Standard boilerplate clauses including notices, assignment, and governing law

Optional Sections

1. Third Party Rights: Required when other parties have specific rights under the agreement, such as tenants or contractors

2. Cost Overrun Provisions: Detailed provisions for handling cost overruns, including additional funding arrangements

3. Pre-lets and Sales Requirements: Include when the funding is conditional on achieving certain pre-let or pre-sale targets

4. Step-in Rights: Provisions allowing the Funder to take control of the development in specific circumstances

5. Development Manager Provisions: Required when a separate development manager is involved in the project

6. Mezzanine Funding: Include when there is additional mezzanine financing involved

7. Green Building Requirements: Specific provisions for environmental standards and certifications if required

8. Cultural Heritage Provisions: Required when the development affects sites of cultural significance to M膩ori

Suggested Schedules

1. Property Description: Detailed legal description of the development site

2. Development Program: Detailed construction program including milestones and completion dates

3. Drawdown Procedures: Detailed procedures and requirements for funding drawdowns

4. Form of Drawdown Notice: Template for drawdown requests

5. Development Budget: Detailed project budget including cost breakdowns

6. Construction Specifications: Technical specifications for the development

7. Form of Practical Completion Certificate: Template for completion certification

8. Required Insurances: Detailed list of required insurance policies and coverage

9. Form of Direct Agreement: Template agreements with key contractors

10. Security Documents: Forms of security documents required under the agreement

11. Professional Team Appointments: Details of key consultants and contractors

12. Reporting Requirements: Templates and requirements for project reporting

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok成人版 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions































































Clauses







































Relevant Industries

Real Estate

Commercial Property

Property Development

Construction

Infrastructure

Financial Services

Investment Management

Urban Development

Retail Development

Industrial Development

Commercial Banking

Property Investment

Relevant Teams

Legal

Finance

Real Estate

Development

Construction

Investment

Risk Management

Commercial

Property

Project Management

Asset Management

Treasury

Compliance

Relevant Roles

Real Estate Director

Development Manager

Investment Manager

Chief Financial Officer

Construction Manager

Project Manager

Legal Counsel

Finance Director

Property Director

Risk Manager

Commercial Director

Investment Analyst

Development Director

Fund Manager

Asset Manager

Industries









Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks, 聽Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination, 聽Severance Pay, Governing Law, Entire Agreemen

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