Paragon Development Finance has provided £4.5 million in revolving development finance to support igloo’s residential scheme at Riverside Sunderland, the FTSE 250 lender has announced.
The funding will support the construction of 34 homes across two phases, comprising two-to-four bedroom townhouses, maisonettes and apartments. All properties are being built using modern methods of construction following igloo’s Footprint process.
Phased delivery structure
The first phase consists of 18 townhouses and maisonettes forming a residential cluster within the Vaux neighbourhood. Phase two comprises 16 apartments based on designs from the government’s Homes of 2030 competition.
The development forms part of Riverside Sunderland, a regeneration project being delivered in partnership with Sunderland City Council and Housing Growth Partnership. The wider masterplan includes new homes, workspaces, leisure facilities and public green space on the former Vaux Brewery site.
According to Paragon, the scheme is expected to meet its Green Homes Initiative criteria, which requires at least 80% of private units to achieve an EPC A rating, with remaining homes meeting minimum EPC C standards. Qualifying developments receive a 50% reduction on loan exit fees.
Second igloo financing
This marks Paragon’s second development finance arrangement with igloo, following its support for the Dundashill scheme in Glasgow. Both transactions were led by relationship director Toby Burgess with portfolio manager Joshua Mann.
The deal represents the third investment through Housing Growth Partnership’s strategic partnership with PFP-igloo, which is targeting delivery of over 1,200 homes across UK regional cities. The financing structure has been tailored to support phased delivery of the homes.
Pete Conboy, project director at igloo, said the development would transform the former brewery site into an urban community. Michelle Williams, project manager at igloo, noted Paragon’s understanding of the company’s approach, while Mike Murphy, investment director at HGP, said the development would deliver homes within the city centre.
The Sunderland scheme adds to broader activity in regional housing markets, where rental yield dynamics continue to shift across different UK locations. Meanwhile, property transaction timescales remain a consideration for developers planning sales strategies.
Toby Burgess, relationship director at Paragon Development Finance, said the lender was pleased to support igloo following the Dundashill project and described the Sunderland scheme as having strong sustainability credentials.
