The Building Safety Act 2022 introduced the most significant change to UK building regulation in a generation. For developers working on higher-risk buildings, the new Gateway process administered by the Building Safety Regulator (BSR) has fundamentally changed project timelines, costs, and — critically — how development finance needs to be structured. Here's what you need to know.
The Building Safety Act: A Quick Overview
Born out of the Grenfell Tower tragedy, the Building Safety Act 2022 created the Building Safety Regulator as a division of the Health and Safety Executive (HSE). The BSR has taken over building control functions for all higher-risk buildings, replacing the previous system where developers could choose between local authority building control and approved inspectors.
The Act introduced a three-gateway system for higher-risk buildings, designed to embed safety considerations at every stage from planning through to occupation. Gateways 2 and 3 are the ones that most directly affect development finance timelines and costs.
What Is a Higher-Risk Building?
A building is classified as higher-risk if it meets both of the following criteria:
- At least 18 metres tall or 7 storeys (whichever is reached first)
- Contains at least 2 residential units
This captures most high-rise residential towers, many mid-rise apartment blocks, and some mixed-use schemes. Purpose-built student accommodation is included. Care homes and hospitals are also captured, though they follow a slightly different regulatory path.
If your scheme doesn't meet these thresholds, the standard building control regime still applies. But if it does, the Gateway process is mandatory — there is no opt-out.
Gateway 2: Before Construction Begins
Gateway 2 is the pre-construction checkpoint. Before any building work can start on a higher-risk building, the developer must submit a building control application to the BSR and receive approval. This replaces the traditional building regulations application process entirely.
The submission requirements are extensive. The BSR requires RIBA Stage 4 (Technical Design) level documentation, including:
- Full plans showing fire safety strategy, structural design, and means of escape
- A competence declaration confirming that suitably qualified professionals have been appointed
- Evidence of resident engagement (for refurbishment projects)
- Confirmation of the Principal Designer and Principal Contractor under the new duty holder regime
The BSR's stated target is to process Gateway 2 applications within 12 weeks. In practice, processing times have ranged from 13 to 36 weeks, with more complex schemes taking longer. The BSR can (and does) request additional information, which resets the clock. Some applications have gone through multiple rounds of queries.
The critical point for developers: you cannot start construction until Gateway 2 is approved. Any work carried out before approval is a criminal offence. This creates a dead period between completing your technical design and starting on site — a period during which you may already have a development finance facility in place, accruing interest.
Gateway 3: Before Occupation
Gateway 3 is the completion checkpoint. Before any residential unit in a higher-risk building can be occupied, the developer must apply to the BSR for a completion certificate. This replaces the traditional final building control sign-off.
The submission requirements include:
- As-built documentation demonstrating compliance with building regulations
- The prescribed documents and information forming the building's safety case
- Evidence that the Golden Thread of information has been maintained throughout construction
- Confirmation that mandatory occurrence reporting requirements have been met
The BSR's processing target for Gateway 3 is 8 weeks, though early applications have taken longer. Until the completion certificate is issued, no unit can be legally occupied. Allowing occupation without a completion certificate is a criminal offence carrying unlimited fines and potential imprisonment.
For developers, this means there is a gap between practical completion of the build and the point at which you can hand over keys, sell units, or start earning rental income. This is another dead period during which finance costs continue to accrue.
The Golden Thread
The Building Safety Act requires developers to create and maintain a "Golden Thread" of building information throughout the design and construction process. This is a structured digital record of all key building safety information, which must be kept up to date and handed over to the building owner at completion.
In practice, this means maintaining a comprehensive digital information management system throughout the build. The BSR expects this information to be accurate, accessible, and maintained to prescribed standards. Non-compliance can result in enforcement action and will certainly complicate your Gateway 3 application.
The Golden Thread requirement has cost implications. You'll need appropriate digital systems, trained staff to maintain them, and processes to ensure information is captured accurately throughout construction.
The Building Safety Levy
From October 2026, a new Building Safety Levy will apply to all developments requiring building control approval in England that include 10 or more residential units. The levy is charged on a per-square-metre basis, with rates varying by region and build type.
The levy is designed to fund the remediation of existing unsafe buildings. For developers, it represents an additional cost that needs to be factored into scheme viability from the outset. Rates have been published by the government and should be included in your development appraisal alongside CIL, Section 106, and other statutory costs.
Impact on Development Finance
The Gateway process has several direct implications for how development finance is structured:
- Longer facility terms: The dead periods before and after construction mean your development finance facility needs to run longer than it would without the Gateway process. We're typically adding 4 to 8 months to facility terms for higher-risk buildings to accommodate Gateway processing times.
- Interest carry during dead periods: Interest accrues during the Gateway 2 waiting period (after drawdown but before construction starts) and the Gateway 3 period (after practical completion but before occupation). This additional interest needs to be budgeted and funded.
- Higher contingencies: Lenders are requiring higher contingency allowances on higher-risk building schemes — typically 7.5% to 10% rather than the standard 5% — to account for the risk of Gateway delays and additional compliance costs.
- Professional fees: The requirement for RIBA Stage 4 documentation at Gateway 2, plus the Golden Thread throughout construction, means higher professional fees. These need to be reflected in your cost plan.
- Monitoring: The BSR's involvement as building control authority changes the relationship between lenders' monitoring surveyors and the building control process. Lenders are still working through how to manage this.
How We Structure Facilities for Gateway Compliance
At developing.fund, we've been structuring facilities for higher-risk buildings since the Gateway regime came into force. Our approach includes:
- Building realistic Gateway processing times into facility term calculations from the outset, not treating them as an afterthought
- Modelling the interest cost of dead periods separately so developers can see the true financial impact
- Working with lenders who understand the Gateway process and won't treat processing delays as developer defaults
- Advising on the timing of Gateway submissions relative to facility drawdowns to minimise dead interest
- Factoring the Building Safety Levy into appraisals for schemes that will be affected from October 2026
The Gateway process is not going away, and it's likely to become more stringent as the BSR gains experience and resources. If you're developing a higher-risk building, understanding these requirements and building them into your financial model from day one is essential. Ignoring them — or hoping for best-case processing times — is a recipe for cost overruns and lender disputes.
We can help you model the full financial impact and structure a facility that accommodates the reality of the regulatory environment. Get in touch to discuss your scheme.