Residential property development finance
Residential development finance helps with the purchase of residential building sites and the development thereon of houses or flats for sale. Lenders will normally provide funding for the purchase of the land, construction costs, utilities, ancillary professional costs such as architect's fees, and roll-up of interest - subject to lending criteria not being breached. Some lenders also provide finance for specialist forms of residential developments such as conversion of barns and churches. Normally high street banks provide up to 75% of the site and 75% of the development costs. We can also help you raise the remaining 25% using other funding sources, subject to meeting certain criteria (see below).
Do you require someone to provide 100% residential development finance including site costs? Click here to find out more!
Commercial property development finance
Commercial development loans assist with the development of commercial properties, which are pre-let in advance and where the lease terms and tenant(s) quality are acceptable in terms of obligation and covenant. Banks will normally consider providing finance for office, retail, industrial, leisure or mixed use development. Lenders generally expect repayment of the loan provided by them to come from the sale of the property or refinance soon after the work is completed. Sometimes, it is also possible to structure a loan to allow the developer to hold the property until the first rent review in order to maximize the resale values. Normally high street banks provide up to 70% of the site purchase costs and 70% of the works.
Other general lending criteria
• Quality of the project
• Experience and background of the management team
• Banks are normally comfortable lending to sole traders, established companies as well as to special purpose vehicle companies (SPVs) incorporated specifically for the purpose of taking forward a development
• Security for the loan generally consists of a first legal charge over the site and a fixed and floating charge over the assets of the borrowing company. Directors' guarantees may be also be required in some instances.
Additional info
• Commercial property finance
• Property development loan repayment calculator
Contact us for FREE consultation
If you are interested in property development finance in UK then talk to one of our experienced consultants to find out how we can help. Please click here to contact us or telephone us on (020) 7016 9775.
Last modified: 28/12/2005 23:38:02