Swallow Hill Homes

A revolving facility secured through Brickflow allowed one user to complete  14 new homes, borrow £2m less than anticipated & save £75K in costs

£4m

Secured Funding

£2m

Facility limit £2m lower than the nearest competitor lender

75%

Saved in lender fees and interest

The Client

Swallow Hill Homes is an experienced regional housebuilder, developing quality family homes in the north and west of Nottingham.

The Challenge

Swallow Hill Homes was part way through a development of 22 new houses in north Nottingham. The company needed to raise finance to acquire its next site three miles to the west of the city, with consent for a further 14 houses.  The site was being acquired in parcels through various agreements funded by cash. They therefore had to complete the final land purchase under an option agreement, which would expire before they had released their capital from the sale of the houses of the original development.

Our Approach

Rob Bailey, Director, Swallow Hill Homes, was introduced to Brickflow by his accountant.   They had been talking to their existing lenders about funding for their next two projects but were offered a facility capped at 30% GDV. This meant they had to fund the next site acquisition from equity and fund the start of works before the facility would become available.

The company were part way through their existing development and had already committed £1.6m of cash flow to purchase land parcels as part of a land assembly for the next site. They therefore needed to raise a funding line to replenish their equity.

Rob carried out a search on Brickflow and assessed the lender options available to him.   He shortlisted four potential lenders, completed an appraisal and submitted the request to each lender, receiving Heads of Terms from all four.

Whilst most of the lenders were looking to fund the land and 100% of the build costs within a facility of approx £6m- £7m, Rob wanted to keep finance costs down.  He produced a cashflow forecast which showed that subject to a phased development with sales during the construction period, he could work within a revolving facility of approx. £4m.   

The Results

Through one of Brickflow’s trusted lenders, Swallow Hill Homes were able to raise a peak debt facility of £4m to replace their equity used to acquire the site. They provided 100% of the cost of construction and interest roll up, based on a facility limit which was £2m lower than their competitors.  This saved the company over £75,000 in lender fees, and on a reduced interest roll up facility, therefore releasing more funds on day one.

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