United Trust Bank has provided £35.5m in build-to-rent finance for a 96-apartment mixed-use development in Earlsfield, south-west London, with a gross development value of £51.1m.
The five-year bridge-to-investment facility allows developer Dominus New Homes to refinance its existing development loan and release equity as the scheme, known as Wandle Place, approaches practical completion. The development includes approximately 9,000 sq ft of commercial space.
Rapid letting progress
Nearly half of the apartments secured tenant agreements within seven weeks of marketing, according to the lender. The development represents a shift in strategy for Dominus New Homes, which has delivered more than 2,000 homes primarily for sale.
“Our business model has always been to build for sale, but current poor demand to buy new flats in London required a rental approach this time, together with an investment loan to repay our development finance on time,” said Chris Mason, director of Dominus New Homes.
The financing comes as London and the South East see widespread price reductions, with developers adapting strategies to market conditions.
Finance structure
United Trust Bank’s Structured Property Finance team structured the facility at 70% loan-to-value, with terms including a stepped-down rate once an agreed interest coverage ratio is achieved. The lending margin reduces once rental income stabilises, expected within three to six months of practical completion.
Property Finance Services introduced the opportunity to United Trust Bank on behalf of Dominus New Homes. Stan Lersch, founder of Property Finance Services, said the priority was to secure funding that would refinance the existing facility and provide long-term certainty.
Martin Cameron, business development director for structured property finance at United Trust Bank, described the deal as an example of the bank’s capacity for substantial lending across the living sector. The £35.5m commitment represents the bank’s first transaction with Dominus New Homes.
Market context
The transaction reflects broader challenges in London’s new-build sales market, which has prompted some developers to pivot toward rental strategies. The build-to-rent sector has expanded as an alternative to traditional residential development models, particularly in areas experiencing mortgage market volatility.
The five-year facility structure provides Dominus New Homes with funding through the initial letting period and into the investment phase, avoiding the need for another refinancing exercise in the near term.
