£1.45m facility, to cover 100% of Project Costs (including acquisition)
68% Loan to GDV and 100% Loan to Costs
Interest Rate 12% per annum, rolled up
1% Arrangement Fee
50% net profit share
18 months term
This was a new-build scheme of 3 detached houses in Reading.
Our experienced developer client had previously agreed to purchase land with detailed planning consent for 3 detached houses near Reading. As another opportunity presented itself during the lead up to the launch of this scheme, our client wanted to explore to possibility of Joint Venture funding, so that he could use his own cash resources to fund another project.
Clearly the developer could demonstrate sufficient experience of having acquired, developed, and sold similar sites previously, meaning this would, in principle, be suitable for our range of Joint Venture funders.
Following a successful site visit and due diligence, the chosen funder covered all the acquisition costs including SDLT and a CIL, and the site was purchased in an SPV. Naturally, the developer had to cover the cost of all up-front professional reports, but these were refunded at completion.
The developer is responsible for dealing with all planning requirements, liaising with the relevant professionals & developing the site in line with the planning consent. This is a self-procured scheme so the developer will act as project manager and build at cost. It is expected that the units will qualify for Help To Buy, and given the developer is also responsible for handling the sales, he will
deal with all such matters.