Case Study: Development Finance Facility for 5 New-Build Houses in South Manchester

Positive Commercial Finance – The UK’s leading bridging and development finance specialist.
Here’s how we helped an experienced North West developer secure fast, flexible funding to build five high-specification family homes in a prime South Manchester location.The ClientOur client was a well-established regional House-builder with an excellent track record of delivering quality residential schemes across Greater Manchester and the North West. The developer owned a brownfield site with detailed planning permission for five detached and semi-detached luxury family homes in a highly sought-after South Manchester suburb. With strong comparable evidence and local demand, the projected Gross Development Value (GDV) was £8.5 million.The ChallengeThe developer needed a development facility to assist with acquisition, demolition, construction, professional fees, and contingency. They wanted:

• A competitive structure with no Personal Guarantees (Corporate Guarantees were acceptable).
• No exit fees.
• Fast completion to avoid potentially rising build costs and keep to the target start date, keeping the project on programme.
• Flexible staged drawdowns aligned to build milestones.

High-street lenders were slow and restrictive,  demanding heavy personal guarantees and additional equity input.Our SolutionFollowing a recommendation, the client contacted Positive Commercial Finance. Within 48 hours we reviewed the full package (planning, drawings, QS costings, and appraisals) and secured an instant Decision in Principle (DIP) from a specialist development lender on our panel.
We arranged a Development Finance Facility of £4.2 million on the following competitive terms:

• Loan amount: £4.2 million (covering refinance of existing debt and 100% of development costs).
• Loan-to-GDV: Approximately 49.5% (conservative and highly attractive to the lender).
• Interest rate: Competitive margin over base rate.
• Arrangement fee: 1% (payable on drawdown).
• Term: 18 months (with extension option).
• Exit fee: Nil.
• Personal guarantees: None required – a corporate guarantee was taken instead.
• Security: First legal charge over the site.
• Drawdowns: Flexible, staged against independent QS certifications and build milestones.
• Monitoring: Retained the client’s existing quantity surveyor .

The entire process from initial enquiry to first drawdown was completed in under 4 weeks, thanks to the client’s strong documentation pack and our established lender relationship.The ResultThe project is progressing now that works have started on site.  
Client Testimonial

At Positive Commercial Finance, we have now funded over £1 billion for developers nationwide and have access to more than 200 specialist lenders. Our no-upfront-fee model and award-winning service ensure you get the right deal without the hassle. 
If you have a residential development project and want a fast Decision in Principle, contact us today.Call: 0161 763 0321
Email: [email protected]
www.positivecommercialfinance.co.ukPositive Commercial Finance is a trading name of Business Financial Solutions Limited. Authorised and regulated by the Financial Conduct Authority.