Development Finance with Presales

About Development Finance with Presales

Many developers own sites suited for apartment schemes but funders generally do not like these schemes as they are exposed to exit risk until the development is completed and then sold, unlike housing sites that can be phased. Assetz Capital works with its sister company, Assetz for Investors (the largest BTL agency in the UK with 100,000 registered BTL investors) to offer a pre-sales solution for both apartment and housing schemes. By pre-selling some or all of the units on deposits of 20% or higher, exit risk can be reduced, developer equity can be released and development loan interest rates reduced. Altogether the intelligent solution for developers looking to stretch their equity further and develop more sites faster.

Fast Facts

Product Benefits

Introducer Benefits

  • A dedicated Relationship Director will work with you to maximise your understanding of our great range of flexible finance products

  • We can supply mailers, term sheets and case studies ready to send out to your clients, co-branded if required

  • We pay procuration fees to introducers where this does not create a conflict of interest

  • One relationship, lots of products to suit different clients

Indicative Terms Sheet

Each facility will be structured and priced on its own merits. We will consider terms outside the above LTV and maximum loan guidelines where the circumstances of the loan warrant it.

Loan Type First Charge
Minimum Loan Amount £1m
Maximum Loan Amount £9m - (On a staged drawdown basis)
Maximum LTV 65% of LTGDV
(gross development value)
Loan Term 6-24 months
Arrangement Fee 3% of facility amount
Exit Fee 2% of facility amount
Interest Rate
(Rate dependent on risk and loan size)
From 7.9%pa on the drawn balance.
Rate will depend on the LTGDV

In Detail

    • A financial appraisal/cash flow
    • An executive summary of the opportunity, including planning and contracting details
    • A "CV" demonstrating the developer’s experience
    • First charge security taken over acceptable properties in mainland UK
    • Where the borrower is a Limited Company, additional security will be required in the form of a debenture over the company, a charge over the shares of the borrower and Personal Guarantees from all Directors/Shareholders
    • Assetz For Investors to have the sole mandate for presales, such and the amounts to be in form acceptable to the lenders, Assetz Capital. Generally, we will require presales covering a minimum of 120% of the maximum loan amount and with minimum [25%] deposits payable for use by the borrower within the project
    • If deposits paid in cash up front, may allow partial equity release for the developer/borrower
    • Interest charged on a daily basis subject to minimum loan term (specific to each loan) and payable on maturity Lending Terms
    • Retained/advanced interest preferred – such that we can pay interest to our lenders monthly, however, we will consider allowing interest to be capitalised
    • Drawdowns monthly and only against independent RICS monitoring surveyors' certificates
    • We will lend to an individual or Limited Company (including SPVs) and are able to consider overseas jurisdictions owning UK properties, subject to suitable foreign legal opinions
    • Broker fees will be added to the loan where the LTV allows and paid on completion. Responsibility for advising the Borrower on structure and pricing will be solely that of the broker.
    • Lending will be based on the market value (180 day) of the completed project, however, we reserve the right to lend based on a different valuation basis should we deem it necessary
    • Where a property is being purchased at a discount, we will lend up to 95% of the discounted purchase price as long as this does not exceed the maximum LTV for the scheme
    • The borrower is responsible for all professional fees and an undertaking/cover for legal and other professional costs will be required
    • Title Insurance will be a requirement on loans where they fit the relevant criteria and the fee for this will be included in the legal cost
    • Use of Assetz For Investors is not a condition of receiving a loan. Assetz for Investors is a separate company. Assetz Capital does not receive remuneration from Assetz For Investors in the event that a developer chooses to use this service
    • Please note: Assetz Capital does not provide FCA regulated mortgage contracts or regulated Consumer Credit loans
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Brochure Download

Click on the link below to download a pdf version of the loan details, with the product benefits, indicative terms and a case study all included.