Development Finance
Starting from the ground up
The days of high street banks’ lending for development finance have long gone. These days you need to have a healthy deposit and some expertise on board to get any lender even willing to listen. When you work with us you’re tapping into our bank of knowledge, experience and a wide range of options to finance your development. Whether you already have land to build on or you are starting from zero and are looking to finance land purchase and build, talk to us before you make any commitments, and you’ll get practical advice on the best way to get your project moving. You can rely on our team for a no-nonsense approach and guidance on the most profitable and viable options.
Our development loans explained
Our lenders can offer flexible finance solutions for developers who have a proven track record. They take a focused approach to your proposal in order to understand the projects you will be undertaking. They will also consider any credit profile so bad luck, a few slip up or banking errors won’t necessarily mean an instant decline. We like to build long-term relationships with our clients and look to fund them throughout their development careers, be that one project or a hundred. We fully understand the importance of finding a broker who can support you throughout your journey and we are here to be by your side.
Mezzanine Development Finance
Mezzanine finance, a loan that could be provided to a developer to sit alongside a senior loan on a 2nd charge basis. The 1st charge lender may only provide funds up to 60-65% of the costs, the mezzanine provider may be able to top that up meaning the developer’s commitment could be much smaller. Mezzanine loans are available from a number of lenders subject to approval by the senior lender which will be considered on a case-by-case basis.
Why might you use mezzanine finance?
Mezzanine finance could allow a developer to spread their finances whilst at the same time increasing any potential return on capital and potentially increasing property development capacity. With mezzanine funding, developers could move onto their next development while still completing current projects as they can commit less equity into a single project. This can provide developers with a critical advantage at a time when competition for good sites is extremely high. In addition to increasing development capacity by carrying out two to three developments in the same period (with staggered commencement dates), the developer can spread their risk over more than one project at any given time.
Developer Exit Finance
Developer exit loans are designed to help a developer exit a completed development quicker so they can move on to their next project. Once a development has reached its practical completion, we can look to raise finance on a completed valuation basis whilst the sales process progresses. This reduces the cost of finance payable by the developer and frees up precious equity to help fund the next project.
Specialist VAT Loans
A VAT loan can be used by developers or commercial property purchasers to cover the additional 20% VAT that is levied on costs and which standard development or acquisition loans may not cover. A VAT loan my provide up to 100% of the VAT that is due back to you so you can manage your cash flow to your advantage. Some lenders may even help you with the process of claiming back the VAT due to you.
If you have a complex case that needs discussing simply call us on 01206 586580 or email us at contactus@wpfinanceme.com
Most Development Loans are not regulated by the Financial Conduct Authority (FCA)
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This article (Development Loans) is intended to provide a general appreciation of the topic and it is not advice.
For more information please contact WP Property Finance on 01206 586580 or email contactus@wpfinanceme.com and we will be happy to assist you.