LendInvest Mortgages has provided a £3.75m development finance facility for a nine-unit residential scheme in the London Borough of Barnet. The funding will support the demolition of an existing building and its replacement with new apartments.
The development will comprise three three-bedroom and six two-bedroom units across ground, first and second floors, with nine basement parking spaces. The facility was structured at 70% loan-to-gross-development-value over an 18-month term.
Repeat borrower arrangement
This represents the second development finance facility LendInvest has provided to the same developer. Upon completion, the borrower intends to refinance onto a buy-to-let line of financing, a sector facing regulatory changes as local authorities gain expanded enforcement powers.
LendInvest approved the deal ahead of the purchase completion date, allowing the transaction to proceed on schedule. Steve Larkin, managing director for development at LendInvest, stated: “This particular facility is the perfect example of a developer seeing the potential in a piece of land, and with the UK in need of new housing, these 9 new apartments are another step in the right direction.”
SME developer funding
The transaction adds to development finance activity in the London market, where property asking prices have shown recent increases. The facility represents a mid-sized development finance deal, significantly larger than smaller exit finance arrangements completed elsewhere in the region.
The 18-month term aligns with typical timelines for demolition and new-build projects of this scale in London boroughs. The 70% loan-to-GDV ratio falls within standard parameters for development finance in the current lending environment.
