When the pandemic hit, many developers with projects underway found themselves in difficult positions. From a lack of available raw materials to the practical constraints of building while social distancing, there were many barriers to progress. And many development finance lenders also became very cautious about proceeding – as this client discovered.
The client:
In this case, our client had a part-built scheme which had encountered numerous delays due to Covid-19. Our client’s existing lender wanted to exit the scheme and was not prepared to fund any further – which was preventing the client from completing the development.
The site in question was valued in £1.2 million, with planning for nine flats. With a total build cost of £1.3 million – but an expected gross development value of over £4 million – this client was understandably keen to complete the work, and therefore approached us after hearing about our experience finding solutions for complex development finance requests.
Our solution:
While it’s certainly the case that many have withdrawn from the market, we know there are still options available, providing you have the right relationships. By liaising with our network of industry contacts, we sourced suitable finance for the client at a very agreeable rate.
This enabled the client to continue with the scheme, meaning that – despite the challenges posed by Covid – they can expect to enjoy a healthy profit from this project. This is a clear example of how, despite the difficulties at play in the market at present, having access to the right relationships can lead to a great outcome.
The case in brief:
- Development finance for site with £4 million GDV
- Build cost £1.4 million
- Existing lender withdrawn from project
- New lender arranged
From mainstream lenders to private offices, our unparalleled network of industry contacts means we can source finance for developments from across the market. Learn more about our development finance offering here.
