Development Finance in Somerset, Worle.
THE BRIEF: OBJECTIVES/PROBLEMS/CHALLENGES:
An existing client and owner of a major building firm in Weston-Super-Mare asked Fox Davidson Commercial Finance to help them finance a site in Somerset. Although our clients had previously built many residential and commercial properties they not yet needed to use development finance.
The plot had planning to change it from a single unit into 5 houses. It was currently derelict and in need of urgent development as it had become an eyesore.
When speaking with a client about a development we will look at all aspects of the deal. The client and their experience, the development, the timescales and ask about the professional contractors involved. We will gather all the necessary information and then take the lending to the right development finance company for that development.
Too many brokers band about deals to development lenders up and down the country which is frankly a waste of everyone’s time. A good broker worth their salt will know which development lender is right for each deal and take the loan to them only.
We had terms agreed with a reputable development finance company within 48 hours.
The financials agreed were as follows:
A rate of 7% was agreed with a 2% lenders fee and a 1.5% exit fee based on the loan amount and not the GDV. Lending would be made available for a term of 18 months.
The exit would be the sale of the 5 houses.
We agreed to waive our fee as the lender would pay us a fee for the introduction. Repeat business is more important to us than maximising our return on each development.
IN OUR OWN WORDS:
Although many developers may have the cash to fund a development themselves, tying up your own cash can be restrictive. Development finance can allow a developer to have several developments under construction at any one time.
This was a straightforward case and one which many of the development funders would like to have funded. The decision on which company to proceed with came down to pricing, reputation for delivering and perhaps more importantly the fact our contact at the lender was local to the area.
In the past we have used lenders located many miles away from the development and more often than not it is important to have someone local to the area that can offer advice to our clients that is only obtained from knowing the local area.
Where possible we like to put together a team of local experts (surveyors, conveyancers, lender etc) that can all work together to ensure funding is delivered on time.
If you are a property developer in Somerset and wish to work with an experience team of property development finance brokers that live in North Somerset then why not visit our development finance page to find out more or contact us to discuss your development finance requirements. Fox Davidson Commercial Finance are a leading development finance broker in Somerset.