£1,825,000 loan to repay development exit finance in London

The Story

Fox Davidson’s Success in Securing £1,825,000 Development Exit Finance for London Property Developer.

At Fox Davidson, we take pride in being a leading UK mortgage broker dedicated to empowering property developers with tailored financial solutions. In a recent success story, we had the privilege of assisting a London-based property developer in securing a £1,825,000 development exit finance loan. This loan not only allowed the developer to efficiently repay the more expensive development finance but also facilitated the release of equity on a completed project comprising three new-build houses. In this case study, we delve into the details of this successful transaction, showcasing how our expertise in development exit finance made a significant impact.

Client Profile:

Our client, a dynamic property developer based in London, had successfully completed the construction of three new-build houses. While the development showcased architectural brilliance and promised a lucrative return, the existing development finance in place was proving to be costlier than anticipated due to delayed sales due to the current economic climate. Recognising the need for a more favourable financial arrangement, the developer approached Fox Davidson for assistance.

The Challenge

The primary challenge for our client lay in the urgency to repay the existing development finance, which was incurring high costs. Additionally, the developer sought to release equity from the completed project to fuel further ventures. Time was of the essence as the developer aimed to capitalise on the buoyant property market in London.

The Solution

Understanding the unique challenges and aspirations of our client, Fox Davidson swiftly initiated a comprehensive financial analysis. Leveraging our extensive network of lenders and expertise in development exit finance, we proposed a tailored solution to refinance the existing development finance and facilitate the release of equity.

Loan Structuring:

Fox Davidson secured a development exit finance loan amounting to £1,825,000, representing 75% of the completed development’s valuation. This strategic loan structuring ensured that the developer had access to a substantial portion of the property’s value, allowing for the efficient repayment of the existing development finance.

Swift Processing:

In response to the urgency expressed by our client, Fox Davidson executed a streamlined application process. Remarkably, the loan was drawn down within a three-week timeframe from the initial application. This expeditious processing not only met the immediate financial needs of the developer but also allowed for a seamless transition from the previous financing arrangement to the new loan.

Benefits Realised:

Cost Savings:

By securing a development exit finance loan at favourable terms, our client experienced significant cost savings compared to the previous, more expensive development finance. This directly contributed to enhanced profitability on the completed project.

Equity Release:

The loan structure facilitated the release of equity, providing the developer with substantial liquid capital. This released equity could be strategically reinvested in new projects, further fuelling the developer’s growth and diversification.

Market Adaptability:

With the new loan set for a 12-month period, our client gained the flexibility to adapt to market conditions. This timeframe allowed for a strategic approach to selling the completed properties, maximising returns in a dynamic London property market.

Conclusion:

Fox Davidson’s success in securing £1,825,000 in development exit finance for our London-based property developer highlights our commitment to providing tailored financial solutions that drive the growth of a property developers business. 

If you are considering a loan to pay off development finance, you can read more here about development exit finance or to discuss funding terms immediately, please do get in touch and one of our advisors will discuss your funding options with you.