Development Finance
Secure tailored development finance to bring your new build, conversion, or redevelopment to life.
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What is Development Finance?
Development finance is a short-term funding solution designed to support property developers with new builds, renovations, and large-scale conversions. Whether you’re a first-time developer or an experienced investor, securing the right finance is crucial for project success.
Development finance usually comes in two parts: the first covers a percentage of the site’s purchase price, while the second funds up to 100% of the build costs, released as the work progresses.
At Christie Finance, our development finance team specialises in securing funding for new builds, redevelopments, and conversions. As an independent broker, we’re free to work with any lender, and our strong relationships with top lenders ensure you get the most competitive deal tailored to your project’s needs.
Key Factors to Consider
When you’re thinking about applying for development finance, there are various things that both you and a potential lender will need to consider:
- Experience: Do you have the right level of expertise to match the complexity of the development you’re currently looking at?
- Exit strategy: How do you plan to repay the loan? A clear exit strategy is essential.
- Financial stability: Lenders will assess your financial health, including your credit history and cash flow.
- Project viability: Is your project financially viable? Lenders will assess the gross development value (GDV) and development costs.
- Market conditions: Lenders will analyse external factors such as demand, economic trends, and planning constraints.
Types of Property Development Finance
- Residential Development Finance – Funding for new-build homes, flats, MUFB’s, refurbishments, and conversions
- Commercial Development Finance
– Loans for offices, retail spaces, and mixed-use developments
- Bridging Loans for Development
– Short-term solutions to cover costs before securing long-term financing.- Development Finance for First-Time Developers
– Specialised funding options for those entering the property market
At Christie Finance, we specialise in securing property development finance for new builds, redevelopments, and conversions. As an independent broker, we have access to a wide panel of development finance lenders, ensuring competitive terms tailored to your project’s unique requirements.
Development Finance Loan Terms
- Loan-to-Gross Development Value (LTGDV): 60-70%, subject to status
- Loan Term: 1-5 years
- Funding Available: Up to £85m in development loans
Who Can Apply for Property Development Finance?
Development finance is available to individuals, partnerships, and companies looking to fund real estate projects. Typical eligibility criteria include:
- A clear development plan and exit strategy
- Planning permissions where required
- Strong financial standing and credit history
- Experience in property development (preferred but not essential)
How to Apply for a Development Loan
Securing development finance requires a well-prepared application. Key requirements include:
- Equity Deposit: Typically, 30% 20% or more
- Good Credit History: Strong financial standing improves approval chances
- Contractor Details: Full information if using a third party
- Development Plan: A clear schedule of works and costs breakdown
- Planning Approvals: Documentation for permissions and compliance
- Track Record: CV outlining previous development experience
How Can Christie Finance Help Me Secure a Development Loan?
From experienced property developers to first-timers, we specialise in helping developers secure the finance they need for their projects. We’ve successfully arranged funding for numerous development finance projects, and we can help you secure the best possible terms by:
- Assessing your specific development goals and financial needs
- Matching you with development finance lenders
- Negotiating competitive rates and terms for your project
- Streamlining the application process
- Ensuring you meet all development finance criteria
- Assisting with the preparation of key documents
- Offering guidance on exit strategies and additional security
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Development Finance in Action: UK Property Project Case Studies
At Christie Finance, we supported the valuation of a care home in Devon undergoing a significant development phase. The planned expansion aimed to increase the number of bedrooms substantially, with each room designed to include ensuite facilities. This upgrade enhanced the quality of care and improved the operational efficiency of the home. The projected uplift in trading performance and profitability resulted in a considerable increase in the estimated value of the property upon completion. This case demonstrated how development finance unlocked growth potential for care home operators, enabling them to scale services, improve resident experience, and strengthen long-term business sustainability.
In another case, we supported a residential developer in securing funding for a small-scale housing scheme in Harrow. The finance package was structured to cover the land acquisition, construction costs, professional fees, and associated interest, enabling the delivery of four new homes. The projected value of the completed development is expected to significantly exceed the initial land value, reflecting the strong potential of the scheme. This example highlights how development finance can empower developers to bring high-quality housing projects to market, with the flexibility and support needed to navigate the complexities of planning, construction, and sale.
Development Finance FAQs
What is development finance?
Development finance is a short-term funding solution designed to support property construction, renovation, or conversion projects. It’s typically used by experienced developers to cover land acquisition, build costs, professional fees, and associated expenses.
How does development finance work?
Funds are usually released in stages, aligned with the progress of the development. Lenders assess the project’s viability, including planning permission, build schedule, and projected end value, before offering terms. Repayment is often made through the sale of completed units or refinancing.
Who can apply for development finance?
Development finance is generally available to experienced property developers or investors. Lenders will look for a strong track record, a clear exit strategy, and a well-structured project plan.
What documents are needed for a development finance application?
Applicants typically need to provide:
- Planning permission and approved drawings
- A detailed schedule of works
- Build cost breakdown and contingency
- Professional team details
- Evidence of past development experience
- Projected gross development value (GDV)
How much can I borrow?
Loan amounts vary depending on the project’s size and scope. Most lenders offer up to 75% of the GDV or up to 90% of total development costs, subject to valuation and due diligence.
What costs are involved in development finance?
Typical costs include:
- Arrangement or commitment fees
- Exit fees
- Monthly interest (often rolled up)
- Professional fees (e.g. legal, valuation, monitoring surveyor)
- Broker fees if applicable
Do I need planning permission before applying?
Yes, most lenders require full planning permission before approving development finance. Outline or conditional approvals may not be sufficient unless supported by additional documentation.
What is the typical term for development finance?
Development finance is short-term, usually ranging from 12 to 24 months, depending on the project timeline.
Can development finance be used for residential and commercial projects?
Yes, it can be used for both. However, the structure and terms may differ depending on the type of development and its intended use.
What is GDV and why is it important?
GDV stands for Gross Development Value, which is the estimated market value of the completed project. It’s a key metric used by lenders to assess loan size and risk.