Example Development Finance Scenarios

Challenge: An experienced developer had secured a site near Wembley Park station with planning permission for 12 residential apartments. The senior lender offered 65% LTC, leaving a significant equity gap that would have prevented the developer from starting a concurrent project.

Solution: We structured a combined senior and mezzanine facility, bringing total leverage to 85% of costs. The senior tranche was placed with a mainstream development finance lender at competitive rates, while the mezzanine element was sourced from a specialist second-charge provider. An intercreditor agreement was negotiated to align all parties.

Outcome: The project completed on schedule, with all 12 units sold within 3 months of practical completion. The developer was able to deploy retained equity into a second scheme, effectively doubling their active project pipeline.

Challenge: A developer wanted to convert a former commercial building into a mixed-use scheme with ground-floor retail and 18 residential apartments above. The mixed-use element and the need for a change-of-use planning application added complexity.

Solution: We structured a phased facility that provided initial funding against the existing commercial value, with the development finance tranche released upon planning consent. This approach allowed the developer to secure the site while managing planning risk.

Outcome: Planning consent was secured after 14 weeks. Construction proceeded to programme, and the completed scheme achieved values in line with appraisal. The ground-floor commercial units were let to local independent businesses, generating ongoing income.

Challenge: A developer wanted to acquire and refurbish a period property in Queens Park to a high specification, creating 4 premium apartments. The conservation area setting required sensitive design, and the developer needed to move quickly to secure the off-market opportunity.

Solution: We arranged a bridging facility for rapid acquisition, transitioning to a light development finance facility for the refurbishment phase. The combined approach provided speed at acquisition and structured drawdowns during the refurbishment works.

Outcome: The high-specification refurbishment was completed within programme, with all four apartments achieving premium per-sq-ft values consistent with the Queens Park conservation area setting. The project demonstrated strong returns on the developer's equity.