BFS provide development funding for 24 unit housing scheme
BFS development funding has been secured by private investors developing a 24 unit new build housing scheme in Ebbw Vale, Wales.
The development firm is owned and operated by a husband and wife team who are investing cash reserves from their successful external wall insulation business into property development. Following a number of successful schemes they have taken on this larger development, totalling 24 houses.
BFS has provided funding to kickstart the build of the first three houses with a total bridging loan of £321,000 across three drawdowns. The client will then sell these properties on and move onto the next three homes in a small phased approach. The development loan allowed the client to begin construction works, utilising an existing unencumbered development to secure the loan.
Keith Litherland, Business Development Manager at Bridging Finance Solutions commented:
“This has been an interesting scheme in terms of the way that the property was acquired and the loan was secured. Development loans are designed to offer flexibility and consider all aspects of the broader project and the clients ability to service the loan. More and more developers are understanding the potential and scope of this type of loan – I believe that’s why we are seeing demand for this particular product escalate.”
The scheme in Ebbw Vale was acquired at auction from receivers from the original developer. The site benefitted from planning consent for 36 properties, 12 of which had been built prior to insolvency. In addition to building and selling the first phase of 12 units, they also installed all services to each plot and fully laid the on-site road with work ready to begin on the remaining 24 homes.
The build is currently at slab level with all work to date funded from the client’s own resources. The current site value sits in the region of £1m in its current condition with an estimated GDV of £4.1m.
“We’re about to release the first stage of funds at which point construction work will begin and the next phase completed. We look forward to working with and supporting the client, not just through this initial phase but onwards to the completion of the development.”