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Monyy Property Development Finance

We can source the property development finance you need, for a whole range of projects, large or small, new build or conversion up to £10m in total costs.

Typical schemes include:

  1. Brownfield Land - previously developed land, with or without buildings, with a proposal to redevelop to achieve a change of planning use and achieve planning gain. Finance can be arranged to cover c65% current use value, plus further development finance on grant of full detailed planning consent, perhaps up to 100% of these costs, in certain circumstances. N.B. we cannot finance green belt land seeking planning permission.
  2. Land with planning, planning gain - an existing permission to build commercial, industrial, retail or residential. Finance can be found in all cases, but based upon a raft of factors. The market viability of the existing planning will be crucial. Bank Valuers provide cautious optimism at best and scathing down values on schemes where market forces are against you. For example, a planning consent to build apartment blocks may not be worth a whole lot, equally a scheme of executive homes would not be welcomed, nor would a speculative build of office or industrial space without a substantial pre-let. So where current planning permission is seen to be unfavourable, finance will be available to buy on current values with a view to changing the consent
  3. Conversions - a retained building reconfigured to provide different accommodation. Finance is harder to arrange where apartments are being proposed. There is an over supply throughout most towns and cities, with prices falling almost everywhere. It would take an exceptional opportunity, with very LTC borrowing below 50% to attract any senior debt funding at present. If the intention is to let the apartments you will need to show affordability from other resources to cover any lending until the scheme is fully let. Once fully let, you will need a rent roll of 1.25x the interest being incurred on the loan.
    If the conversion is for commercial use, for a self-occupier, the balance sheet and P & L of the acquiring company will be key to obtaining funding, perhaps up to 80% LTC. If the intention is to let the commercial space as an investment then a large proportion of pre-let will be necessary to attract a lender.
  4. New Build - a viable market scheme for residential, commercial, industrial, retail or office. Finance is available for professional experienced developers, but cash and pre-let are the key ingredients required to attract senior debt of about 65% LTC. Apartments remain out of favour, even when pre-sold to investors paying 10% deposit; too many schemes have fallen in the recent past. Private landlords trying to let to students or people drawing housing benefit are also going to struggle. Senior debt providers want far more certainty now about affordability, security and repayment. The only response from developers is ever larger amounts of their own cash to make these schemes fly.

If your proposed scheme falls down on lending criteria, it may be possible to improve its chances with the addition of more cash. This can sometimes be provided through Mezzanine Finance, but sometimes not. Even these more entrepreneurial lenders have strict lending criteria. When this is unavailable, we can sometimes find you an investment partner to join you in the opportunity, introducing cash, expertise and credibility to help unlock senior debt. Our new service, Opportunities and Deals notice board is an ideal place to begin your search.

For more information, please call 01949 81918.