Development deal in real time: Part 1

Development deal in real time: Part 1



822_2022-06-15-02-36-46pm.gif
A series of updated monthly instalments looking at a real life development case study, which will include pictures of the sites and details and hurdles the development faces.

 With lenders in the short term sector beginning to diversify their product range to help a broader range of clients obtain the finance they need, B&C has brought you the very best in recent deals that have utilised these new and innovative niche products.

We now bring you the first in a series of updated monthly instalments looking at a real life development case study, which will include pictures of the sites and details and hurdles the development faces…

Mr and Mrs S were longstanding clients of AIB developing around the Midlands. After completing numerous deals successfully they had no idea that their funding would be withdrawn due to the proven track record that they had built up. Unfortunately, AIB turned the borrowers down on the funding of a single new build development and they in turn approached ABC Finance Limited to see if they could assist.

Peter Hemmings, Managing Director of ABC Finance Ltd, approached Regentsmead who specialise in the provision of residential development finance.

Peter Hemming said: “I fully packaged the case to avoid any delay and introduced the clients to the lender on the Friday. A meeting took place on the following Monday morning, solicitors were appointed Monday afternoon and the surveyor was at the site on Wednesday. That’s what I call service and it is a breath of fresh air in the current climate. It’s not all bad news when you know where to go for funds and Regentsmead certainly do what they say they will.”

He added, “The clients are absolutely delighted with the service and so are we and our introducer.”

Nick Warren, head of Regentsmead’s lending division, commented: “We have dealt with Peter on various transactions and were delighted to help Mr and Mrs S on their new project. Obtaining funding in any business is challenging but our dedication to the development sector has never changed even with the economic turbulence that others have endured.”

The clients had purchased a plot in the Midlands for £100,000, which the borrowers in turn obtained planning to construct a 2,200 square feet four bed detached house. The estimated build costs are £220,000 with a projected completed value of £575,000. The site was unencumbered and represented a very profitable scheme for the borrowers if they could obtain the funding. The loan had an LTV of 38 per cent.

Nick Warren added: “The clients are extremely knowledgeable developers and have acquired an excellent plot so we are only too keen to provide a facility of £220,000 for the construction of the house.”

Works have commenced on site with the first stage of DPC being completed within the next few weeks, which will be reported on in the next issue of this live case study.

This live case study will show the various stages of the project from the foundations through to the completed project over the coming months. Construction is due to be completed around October 2012.

 

 

Leave a comment