Avamore Capital has provided £3.3 million in development finance for a six-unit residential scheme that includes substantial highway infrastructure work, marking the lender’s first transaction with a newly formed borrower partnership.
The 18-month facility, structured at 68% loan-to-gross-development-value, will fund construction of six detached homes alongside off-site highway improvements, including carriageway widening and new footway installation. The highway works must reach 90% completion before vertical construction can commence.
New partnership structure
The loan represents the first joint project between three construction professionals, though one borrower had an existing relationship with Avamore. The lender assessed the deal based on individual experience rather than partnership track record.
“This was a really interesting deal where the strength of the individuals involved stood out, despite this being their first project together,” said Aidan Lesslie, relationship manager at Avamore Capital. “Having previously lent to one of the borrowers gave us additional comfort, and we were able to take a pragmatic view on the partnership as a whole.”
Infrastructure requirements
The project’s infrastructure component added complexity to the financing structure. Avamore’s underwriting process focused on the local highway authority’s technical acceptance and the sequencing of the highway works relative to residential construction.
“The structure required a detailed understanding of both the planning position and the timing of the highway works,” said Saif Ali Khichi, underwriter at Avamore Capital. “We were comfortable with the sequencing risk given the authority’s technical approval and the clear path to delivery.”
The transaction comes as the UK property market faces challenges, with recent data showing 44% of homes listed for sale failing to find buyers. Development finance remains available for schemes with clear delivery paths, though lenders continue to scrutinise partnership structures and project complexity.
Joshua Rowe, transaction and structuring analyst at Avamore, coordinated the deal execution between the borrower and internal teams. The completion adds to the lender’s ground-up development portfolio, which includes projects with technical or procedural complexity beyond standard residential construction.
