Kent Houses — 4 Detached

A first-time developer with a background in construction management had acquired a plot in a Kent commuter village with detailed planning permission for 4 detached family homes. The site was well-located with strong comparable evidence supporting a GDV of £2.1m, against total development costs of approximately £1.69m.

The challenge was straightforward but common: no track record as a developer. Despite over 15 years of experience managing residential builds for other developers, no lender had previously funded a scheme in his own name. Two high-street banks had already declined the application on track record grounds alone.

The developer needed approximately £1.1m to cover the land purchase balance and full construction costs, and wanted a lender who would support him through the process rather than simply monitoring from a distance.

First-time developer applications require careful positioning. Most mainstream development lenders have minimum track record requirements — typically 2 or 3 completed schemes. Without that history, the application needs to demonstrate competence through alternative evidence: construction qualifications, site management experience, a credible professional team, and a conservative appraisal.

The build costs also needed careful scrutiny. First-time developers often underestimate contingency requirements and professional fees. We needed to ensure the appraisal was robust enough to satisfy the lender's monitoring surveyor while remaining commercially viable for the developer.

We identified a specialist lender from our panel who actively supports first-time developers — provided the application is properly structured and presented. We produced a full development appraisal and cashflow model demonstrating a healthy 24% profit on cost, with a 15% contingency built into the construction budget. The appraisal, business plan and presentation gave the lender confidence in both the project and the borrower.

We packaged the developer's 15 years of construction management experience as equivalent track record, supported by references from quantity surveyors and architects he had worked with previously. We also arranged for an experienced project manager to be formally appointed to the scheme — giving the lender additional comfort and securing not only their commitment but competitive pricing.

The facility was structured at 65% loan-to-cost with staged drawdowns against a monitoring surveyor's certification. Interest was rolled up into the facility, meaning no monthly payments during the build period.

The scheme completed in 13 months — one month ahead of the original programme. All four houses sold within 8 weeks of completion, achieving values slightly above the original appraisal estimates. The developer's total finance costs came in at approximately £72k, representing a blended rate of 7.5% per annum.

The developer achieved a profit of approximately 20% on cost after all finance charges — a strong result for a first scheme. More importantly, he now has a completed track record that opens the door to larger facilities and more competitive rates on future projects. He has since returned to us for a 9-unit scheme in the same area.