80% Loan to Value, based on Open Market Value
Interest at 0.95% per month
2% Arrangement Fee
No Exit fees
8 months term
Our experienced developer client had almost finished two residential sites he was running in parallel, in South West England. He had used a structured Development Finance package initially, consisting of senior debt and mezzanine finance, which he was keen to refinance away from due to the cost of that finance.
On the first site, 3 units remained unfinished, but only with minimal works required to get to Practical Completion. Both the lender and the valuer took a sensible commercial view and the lender held a retention back cover the cost of works. As such, the GDV was used to calculate the Day 1 loan amount, as opposed to working from what would have been a much more conservative “investment” value of the site, which could have scuppered the deal.
Works will be finished imminently and given the very healthy level of demand an 8 months period was deemed sufficient to sell the remaining properties.