Ruby Purchase Groups

Tailored construction financing for projects owned by purchase groups and private landowner groups

A purchase group is an association of private buyers who build together rather than purchase finished units from a developer. Because group members own the land and directly retain the contractor and professional team, they require a financing structure tailored to a decentralized ownership model.

Understanding the Financing Challenge

Unlike traditional developments, a purchase group’s ownership is distributed across multiple individuals, each with a distinct financial profile, liquidity position, and timeline. Without a single developer holding the obligations together, the financing must be designed around the group itself.

To ensure long-term stability, repayment strategies for each member must be planned from day one.

Three Core Group Structures

As the dedicated division within Ruby Finance, Ruby Purchase Groups provides customized capital solutions for three main group structures:

• Tender Bidders: Established groups with a proven track record competing in Israel Land Authority (ILA) land tenders.
• Group Organizers: Professional organizers who acquire land and assemble buyer communities, requiring a funding partner skilled in both real estate development and multi-owner alignment.
• Private Joint Landowners: Private co-owners developing shared land who require flexible capital and hands-on portfolio management that a bank does not always provide.

Facilities and Coverage

Financing is structured as a closed construction loan secured by a first mortgage on the land, covering the complete project lifecycle, including:

• Pre-Permit Expenses: Early-stage capital for planning, architectural design, and statutory permitting.
• Construction Credit Lines: Tailored loans issued directly to individual members based on their specific financial profiles.
• Flexible Draw Schedules: Payment timelines optimized to match construction milestones and cash flow needs.

Key Feature: Group members can transition to a permanent mortgage once construction reaches 75% completion, significantly reducing their monthly interest costs at the point where the credit line is almost fully drawn.

Risk Mitigation and Controls

Two risks come with group ownership: Members can leave, and members can fall behind. The partnership agreement covers both from the outset, and the financing is built to absorb them.

• Centralized Account: All project funds flow exclusively through a single, dedicated project account.
• Active Monitoring: Continuous, real-time oversight of individual member contributions.
• Customized Underwriting: Tailored credit lines aligned with each member’s solvency and risk profile.
• Early Refinancing Protocols: Early mortgage pre-approvals to prevent late-stage funding gaps.
• Experienced Organizers: We work with organizers who have a proven track record. They do what a developer would otherwise do, moving the project forward while also holding the members together.