Development finance is a loan granted for the development or refurbishment of residential, commercial or mixed-use properties. Development finance is often granted to experienced builders and developers so that they can raise the capital to turn their building aspirations into a commercial reality.
Lenders will offer a loan based on the predicted value which is also known as growth development value (GDV), of the development once it has been completed. Within the development cost, the interest, site cost and construction is all funded. The borrower will need an exit strategy outlined whether that will be via a sale or refinance e.g Mortgage. Development loans are available for up to 24 months depending on the development time scale. Individuals, partnerships and limited companies are all eligible to apply for this type of loan.
Why Choose Development Finance?
Development finance is necessary for builders and developers who require the capital to finance larger scale projects, in predominantly the residential and commercial sector. Development finance can be utilised to avoid tying up substantial amounts of your cash and budget until the end of the project where the land or property is either refinanced or sold. With a free up of capital, you are then able to move onto another building project much quicker.
Another benefit of development finance is that the return on investment rate will be greater if you are investing less capital at the start of the finance agreement. To begin with, the cost of the financing will have to be payed from the profits generated from the point of sale. However, in the long-term, the actual rate of return on the initial investment will be much higher.
Free Up Your Capital
Helps to avoid tying up your funds in the building project, making it easier to progress with development.
Expect a greater return of investment (ROI) using less capital.
Repayments are made at agreed stages throughout the building project, ensuring adequate cash flow throughout.
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What our clients say
“I have worked with Bespoke for several years now and have built up a very trusting relationship with the team. They’re always professional, deal with customers very fairly and ensure they’re offered the most effective solutions to meet their needs. I have no reservations in dealing with Bespoke and their abilities to provide suitable solutions for customers.
— Scott Campbell
Head of Barclays Business Sales
I have recommended Bespoke’s services to a number of our clients, both that have existing factoring facilities and also to clients who are looking at their financing options. The service provided has always been exceptional and the feedback from these clients has been nothing but praise. I would therefore highly recommend the Bespoke team.
— Tim Pearce
Managing Partner, Haines Watts
We contacted Bespoke as we were looking for an invoice finance facility to support the business due to our fast growth. They didn’t disappoint! They gave us first-class advice and support and within a week had provided us with a choice of competitive funding options. Bespoke worked with us through the decision process and helped us secure a finance facility which was ideal for our business and offers the flexibility for future growth. A-first class service throughout.
— Paul Davison
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