Developers with years of experience, seek reliable short-term property finance providers to secure funds on suitable terms, ideally with a quick turnaround and terms that do not change once agreed.
An experienced, Hertfordshire-based property developer with a proven track record of successful investments and developments, seeking a £744,000 bridging loan to complete an upcoming project, was introduced to Signature Property Finance by Concept Financial Group.
The developer already owned the subject property site with planning consent held for a single residential house. However, they were still in ongoing discussions with an interested party regarding the sale of the plot, whilst also considering making an application for amended consent to increase the house dwelling size and therefore site value.
Once the necessary background checks had been carried out, Signature agreed to provide the required funding, which would be utilised to repay the existing loan, raise capital to market the site and potentially amend planning consent.
Marketing a seven-figure site
Located in a popular commuter village with strong rail and road links, the site had a proposed development for a four-bedroom executive style detached house, along with a detached garage and car port.
At the time of the inspection, the site was a cleared land plot, with no building works having yet commenced. Therefore, its value was determined both on a comparable basis by looking at similar properties and on a residual value approach.
Through a thorough analysis of the proposed floor areas, the valuer felt a GDV of £2,100,000 would be appropriate for the finished development, with a ‘good’ demand for this type of property in the local area. With build costs estimated to total £650,000 and other outgoings reaching £385,000, the development could collect a seven-figure profit upon completion.
In any case, the developer provided a local agent comment for a plot sale price of 1.25m, which was to be the primary source of repayment once a buyer had been found. With this in mind, Signature were happy to agree a 12-month term, as this was deemed enough time to market and sell the site.
Signature Property Finance Lending Manager, Alan Coats, commented: “Our ability to attract high-profile property developers and investors stands testament to the first-class services we offer as a short-term property finance provider.
“Over the years, we have built a strong reputation for our customer-centric approach, going above and beyond to help clients secure much-needed funds on terms that benefit them and their cost/timescales, always following through on promises made at the outset.
“Of course, working alongside such an experienced developer allowed us to move forward with the deal quickly, as we were confident in their proposed exit strategy and understood the vision for the project.
“It helps when we work with experienced brokers, such as Concept Financial Group, who really understand what makes a good deal and what works for all concerned. We expect this to be just the latest in a string of similar deals as we support future developments of Concept’s clients.”
Mark Reidy, Owner of Concept Financial Group, added: “This deal is another in a long line of transactions we have completed with Signature Property Finance this year. I am delighted that our customers can enjoy fast access to bridging and development funding on competitive terms coupled with a reliable service and fast commercial decisions.”