Ruscombe Road

We provided development finance for the completion of a new residential development. We are also instructed on securing a commercial exit in the form of a block sale.

Case Overview

  • The client wanted to purchase a former office building to build 19 new-build apartments & 2 new-build houses
  • Whilst purchasing was going through a planning application was submitted to demolish the existing building
  • Purchase price of the land: £100,000
  • Development cost (excluding purchase & finance): £1,180,000
  • Total Development Costs (excluding finance): £1,280,000
  • GDV: £2,051,250
  • As well as raising finance the client required finance for the development
  • Completed units would then be sold to recoup all project costs

Deal Structure

As the property was being purchase without planning permission for the proposed development, we were able to secure 65% Loan to Purchase Price (LTPP).

Upon full planning approval the Residual Land Valuation (RLV) of the site became £325,000

The same lender agreed at the outset, that upon planning approval and due to the uplift in RLV, they would fund 100% of the development costs.

Although the developers cash into the project was only £35,000. They also had the planning gain on the site of £225,000.  Making their total equity contribution £260,000

Completed properties put on the market

Development Exit Loan of £1,400,000 secured to repay Purchase & Development Loan, at a lower rate and release a small % of the profit.

Sale of properties to repay Development Exit Loan and release remainder of developers profit


Added Value

In addition to securing finance for the project we assisted with client with the following services:

  • Full Development Appraisal due diligence – to access viability, profit and lender appetite
  • Residual Land Value Calculations
  • Due diligence of property for the client
  • Due diligence of planning
  • Continual monitoring of the project and reporting to lender
  • Freehold sale arranged for the developer

Project Advantages

  • Site secured quickly so that client benefited from the planning gain uplift
  • Residual Land Valuation to support client equity contribution
  • Sourcing of one product for both the purchase & development
  • No delays in receiving draw downs from the development facility

Products Provided

Purchase & Development Loan

Development Exit Loan

Property Sales

  • Funding Type: Development Finance
  • GDV: £2million
  • Funding Amount: £2.58million
  • Region: Liverpool
  • Client Type: Residential Developer

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