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    Commercial development finance

    What is Commercial Development Finance?

    Commercial development finance is funding for building new commercial property, to rent, sell or use as your own premises

    Here’s everything you need to know if you’re looking to secure a commercial development loan.

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    How is commercial finance different from residential development finance?

    Commercial property includes offices, warehouses, logistics space, student accommodation, retail space, medical facilities and hotels, as opposed to residential houses and flats.

    The key difference with securing a commercial development loan is that there are fewer lenders in the market, so they can be difficult to find if you don't know where to look.  Most will also require a pre-let or pre-sale of the end property before they agree to lend.

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    Types of commercial development finance

    Gain instant online access to loans for a variety of commercial property developments

     

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    New build

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    Conversion

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    Refurb
    Types of commercial development lenders

    Search all types of commercial development lender to ensure you receive the best value loan, every time

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    High street banks

    brickflow-development-finance-icon-challenger-banks

    Challenger banks

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    Specialist development lenders

    How does commercial development finance work?

    Our lenders provide commercial development loans from as little as £150k, up to £150m.

    The main criteria commercial development lenders look at to calculate how much they will lend are:

    1. Loan to Gross Development Value (LTGDV)
    2. Loan to Cost (LTC)
    3. Minimum client equity contribution
    4. Day 1 land loan cap

    The lender determines the loan amount from a combination of the above factors and delivers a final combined amount. Other factors that can affect leverage and pricing are; micro geography, asset type, lender loan book exposure, development experience and build type.

    Because lenders will almost always need either a pre-let or pre-sale of the asset before they can fund your scheme, contracts will need to be exchanged prior to the development loan completing.

    If you plan to retain the property for rental at completion, the development lender will need to see proof of a longer term commercial mortgage to redeem their loan. Brickflow can help with this by searching the market for commercial mortgages.

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    Get ahead of the game

    Join thousands of property professionals already doing more with their development finance

    40 +
    Trusted lenders
    2000 +
    Property developers
    20 +
    Average hours saved per application
    £ 509 k
    Average reduction in deposit*

     

    *Across a sample 10 transactions where the borrower already had an offer

    Ready to apply for commercial development finance?

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