Development Loan
- Location: England, Wales and Scotland
- Tenure: Freehold or Leasehold, with a minimum of 60 years
- Security: 1st Legal Charge over the underlying asset, share charge, debenture, Personal Guarantees (as applicable) and collateral warranties from professionals with design and structural liabilities
- LTGDV: 75% (Gross)
- LTC: Up to 95% of the built cost subject to LTGDV criteria and developer strength.
- Minimum GDV: £30 million
- Interest payment: Serviced or rolled up
- Gross Loan: £20 million to £200 million
- Term: 12 – 48 months
- Regional and National Housebuilders
- Professional Developers
- UHNW & HNW Individuals
- Public Listed Companies
- Private Limited Companies
- Overseas SPVs
- Residential Dwellings (Houses/Apartments)
- Land with planning permission for residential development
- Student Accommodation
- Retirement Living
- Care Homes
- HMOs
- Location: England, Wales and Scotland
- Tenure: Freehold or Leasehold, with a minimum of 60 years
- Security: 1st Legal Charge over the underlying asset, share charge, debenture, Personal Guarantees (as applicable) and collateral warranties from professionals with design and structural liabilities
- LTGDV: 75% (Gross)
- LTC: Up to 90% of the built cost subject to LTGDV criteria and developer strength.
- Minimum GDV: £30 million
- Interest payment: Serviced or rolled up
- Gross Loan: £20 million to £200 million
- Term: 12 – 48 months
- National and Regional Developers
- UHNW & HNW Individuals
- Public Listed Companies
- Private Limited Companies
- Overseas SPV
- Offices and serviced offices
- Retail shops
- Hotels and serviced apartments
- Industrial & Logistics
- Land with planning permission for commercial development
Development Loan FAQs
Can you get a loan for Property Development?
Yes, finance is commonly used for property development in the UK. Most developers use finance alongside their own equity to either increase their return on investment or to give them access to larger projects – or a combination of both.
At London Wall, we provide development loans that will cover up to 90% of the total costs of a project, including site acquisition and professional fees.
We work with experienced developers with strong track records, that require financing support to their projects across the UK.
London Wall offers bridging loans and development loans to new and existing clients. We have expertise in lending against residential properties and commercial properties. Our loans are classified as unregulated and therefore the property being offered as security must not be your place of residence.
How do Property Development Loans work?
With a typical property development loan, the lender will agree at the outset what the loan to cost ratio is that they are willing to lend on. At London Wall, we offer up to 90% loan to cost, which means the developer will be required to put in 10% of the total costs of the project as equity.
The developer’s equity needs to be fully utilised before the lender will allow drawdowns to start on the development loan. The total costs can include the value of the development site, which comprises the equity in the transaction.
The remaining costs will then be funded monthly, based on the works carried out in that month.
Once the development is complete, the initial sales will be used to repay the development loan.
London Wall offers bridging loans and development loans to new and existing clients. We have expertise in lending against residential properties and commercial properties. Our loans are classified as unregulated and therefore the property being offered as security must not be your place of residence.
What information is required to apply for a Development Loan?
Lenders will require comprehensive details of the proposed development, financial projections, and developers experience, in order to consider a development loan request.
Information on the proposed development should include background information on the site, copies of the approved planning consent, details of what you are planning to build, and the construction methodology being used.
Financial projections, referred to as development appraisals, will include both the costs incurred to date (for example, to acquire the site), the total costs required to construct the proposed development, including professional fees, and forecasts for the gross development value once completed.
Lenders will also want to know details of your experience as a developer and how this relates to the proposed scheme, along with that of any main contractors or professional firms with design responsibility (such as architects, structural engineers and so on).
Whilst this is not a comprehensive list, it will provide a lender with the initial information required to consider whether they can issue terms for a development. Once terms are agreed, site and/or specific transaction requirements will be advised, along with the requirement for an independent valuation and initial quantity surveyor report to be obtained.
London Wall offers bridging loans and development loans to new and existing clients. We have expertise in lending against residential properties and commercial properties. Our loans are classified as unregulated and therefore the property being offered as security must not be your place of residence.
What are typical Development Loan terms?
Terms vary by transaction. That is because not all developments are the same and loan terms are designed to reflect the risks of an individual transaction.
A lender will consider risk metrics such as how strong the developer is, the type of asset being constructed, and the level of financial support required to complete the development.
London Wall offers bridging loans and development loans to new and existing clients. We have expertise in lending against residential properties and commercial properties. Our loans are classified as unregulated and therefore the property being offered as security must not be your place of residence.
