DevelopmentDevelopment finance from land to completion.
Funding for ground-up schemes, conversions and heavy refurbishment, built around your exit.
About development lending
Funded from land to completion.
A development facility is sized against a building that does not exist yet. That is why lenders look as hard at the team and the programme as at the site, and why the appraisal matters more than the headline rate.
Development finance is drawn in stages against certified build costs, with interest usually rolled up and repaid with the loan when the scheme is sold or refinanced. Lenders size the facility two ways: as a percentage of the gross development value (the finished value) and as a percentage of total cost, including the land. The tighter of the two applies.
Pricing is monthly and depends on the scheme and the team: an experienced developer on a standard residential scheme at a modest loan-to-GDV prices best; a first scheme, or a complex, commercial or speculative project, carries a loading and a lower leverage ceiling. Mezzanine and equity top-ups are available where the senior facility leaves a gap.
We arrange the exit as well as the build. Once a scheme is practically complete, a development exit loan or sales-period bridge at a lower rate takes the pressure off the last few units and releases some profit early, rather than leaving the senior facility running at development pricing while the sales board goes up.
Development · key criteria
- 01Up to 75% of gross development value
- 02Up to 90% of total project costs
- 03Ground-up builds and conversions
- 04Staged drawdowns as the build progresses
- 05Terms from 1 to 18 months
FAQs
Common questions about development lending.
How much development finance can I get?
Typically up to 75% of the gross development value and up to 90% of total cost, whichever is lower. Experienced developers on residential schemes sit at the top of that range; first schemes and commercial projects lower.
How is the money released?
The land element is usually advanced on day one, with the build cost drawn monthly in arrears against a monitoring surveyor’s certificate of work done. Interest is normally rolled up into the facility rather than paid monthly.
What experience do lenders want to see?
Ideally a completed scheme of similar size and type. First-time developers can still be funded, particularly with an experienced contractor and a strong professional team, but at lower leverage and a higher rate.
What about planning?
Most development lenders need full planning consent before they will lend on the build. We can arrange land or bridging finance to hold a site while consent is obtained, then refinance onto development terms.
What fees apply?
Expect an arrangement fee of around 1–2% of the facility, an exit fee of around 1% of the loan or GDV with some lenders, plus valuation, monitoring surveyor and legal costs. Every fee is confirmed in the indicative terms.
What happens when the build finishes?
The facility is repaid from sales or a refinance. Where units take time to sell, a development exit loan at a lower rate replaces the development facility and releases some profit early.
Lender panel
The right lender, not the nearest one.
- HSBC
- NatWest
- Nationwide
- Shawbrook
- HTB
- Cambridge & Counties Bank
- Allica Bank
- + many more across the market
*We have access to the lenders shown, among others.
Other lending
Finance across the whole commercial market.
CommercialExplore commercialPurchase or refinance premises, up to 75% LTV.
Buy to LetExplore buy to letSingle lets to portfolios, personal or SPV.
BridgingExplore bridgingFast, short-term funding for time-critical deals.
Asset FinanceExplore asset financeFund new kit, or release the capital in yours.
Development finance
From the site to the last unit.
Site, build and sales period, funded in stages, with the exit arranged before you need it.
No credit check. No obligation.
- 1
Run the appraisal
Build costs, gross development value, and the gap the facility has to fill.
- 2
Size the facility
The tighter of loan to GDV and loan to total cost decides it.
- 3
Draw and exit
Staged drawdowns against the surveyor, then the exit arranged in advance.