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Bridging · Developer exit

Developer exit finance

A refinance for completed or nearly completed schemes, giving unsold units the time to achieve full value while you redeploy capital into the next project.

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How developer exit finance works

Development facilities are priced for construction risk and usually carry a fixed term. Once a scheme reaches practical completion, that risk has gone — but the facility often remains more expensive than it needs to be, and the term may be close to expiry.

Developer exit finance repays the development lender and replaces it with a short-term loan secured against the finished units. Because the asset is complete, rates are often lower than the development facility, and in some cases the refinance also releases equity for your next acquisition. The loan is repaid as units sell.

Typical uses

  • Repaying a development lender at or near practical completion
  • Avoiding default interest or extension fees on an expiring facility
  • Releasing profit to fund the deposit on the next site
  • Giving the sales agent time to sell units at full value rather than at a discount
  • Holding completed units while a longer-term refinance is arranged

What lenders will look at

  • Practical completion certificate, building control sign-off and warranties
  • Current sales position — reservations, exchanges and pricing evidence
  • The redemption statement from the existing lender
  • The agreed release price for each unit

Questions

Frequently asked questions

Can I refinance before practical completion?
Some lenders will refinance a scheme that is close to completion, provided the remaining works are minor and costed. Others require a practical completion certificate and building control sign-off. We will tell you which applies to your scheme.
How are release prices worked out?
The lender agrees a minimum amount to be repaid from the sale of each unit — usually a percentage of the loan allocated to that unit, plus a margin — so the loan reduces faster than the security as sales complete.
Can developer exit finance release equity?
Where the completed value supports it, yes. The refinance may repay the development lender in full and leave a surplus that can be used for a new site, subject to the lender’s maximum loan-to-value.

Have a bridging deal in front of you?

Send us the headline numbers. We will tell you plainly whether it is fundable, how we would structure it, and what we would need to take it to lenders.

Get indicative terms

Or email maxwell@koulenandpartners.co.uk