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Residential Apartment Building

Development Finance.

Bringing Clarity to the complex world of Property Finance.

Modern Bridge

Bridging

Approaching the wrong lender with a scheme they are unlikely to support is going to make getting finance hard.

The property financing markets have undergone significant change in recent years, developers and investors having to adapt their business models including their approach to financing.

High Street Banks in most cases are no longer a viable option for smaller developers . Since 2008 we have seen a dramatic change in the lending landscape with the rise of many alternative institutional and professional lenders, financiers and private equity.

Experience in and an intimate knowledge of this market is the best way to succeed in getting the finance you need to get your development off the ground

We exist to bring great development opportunities, correctly packaged and fully understood, to the right lenders in the right way at the right time.

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Senior Debt.

“Senior” debt is a first charge development finance loan, that would typically make up the majority of the funds required to complete a property development project. Such facilities are to be used specifically for property development, and are structured in such a way to best suit the proposed scheme.

Key Lending Criteria

  • Typically up to 65% of GDV, or 90% of project costs

  • Arrangement fees from 2%

  • Interest rates from 9% per annum

  • Options with no Exit Fees

  • Up to 24 months, or longer by agreement

  • Minimum loan £100k, with no maximum loan size.

  • Countrywide coverage

Skyscrpers

We are here to help - there is no obligation - please do give us a call, email us or fill in the form above and we will get back to you as soon as possible

07497 113341
dan@claritydevelopmentfinance.co.uk

07984 150034 

matt@claritydevelopmentfinance.co.uk

Mezzanine finance.

Second charge development loans are used to plug a short-fall behind a Senior Debt facility.

Key Lending Criteria

  • Mezzanine Funding is secured by a Second Charge

  • It is essential for developers to be experienced to access mezzanine finance.

  • Full Detailed planning consent needs to be granted.

  • Valuation Reports & QS/MS reports which are instructed by the senior lender, can also be utilised by and addressed to the Mezzanine Lender.

  • Available for residential and commercial property development schemes in England, Scotland and Wales

  • Personal Guarantees will be required.

Image by Harry Shelton

Key Features of Mezzanine Finance

  • Loans of up to 75% of the Gross Development Value, or

  • Loans of up to 95% of Total Project Costs (plus finance costs).

  • The Arrangement Fees charged by the Mezzanine Finance Providers are case by case and start from 2%

  • Interest Rates for Mezzanine Finance start from 18% per annum.

  • Exit fees are generally charged but again, case by case.

  • Minimum mezzanine loan size is £100,000, with no maximum loan size.

  • No profit share is generally required with mezzanine loans.

  • Up to 36 months terms available on larger schemes.

    We are here to help - there is no obligation - please do give us a call, email us or fill in the form above and we will get back to you as soon as possible

Image by Sean Pollock

Equity.

Equity is the value of an asset less any debt..

Third party equity is needed, from an Equity Investor, particularly if the borrower does not have enough cash (equity) to make the finance package work. Equity Investment is often invested into a project in return for part ownership of that project. This could be shares in the company or a profit share with a priority return on the funds invested. Equity Investment therefore allows the Developer to “unlock” development finance for the project.

Key Lending Criteria

  • Developer needs a proven track record, with a good reputation.

  • Solid Business Plan.

  • Excellent understanding of their chosen market

  • Strong and Stable financial position

07497 113341
dan@claritydevelopmentfinance.co.uk

07984 150034

matt@claritydevelopmentfinance.co.uk

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