Development Financing For A Co-Living Property In Hertfordshire Town

What was the situation?

Our client, a UK citizen operating through a UK Special Purpose Vehicle (SPV), approached us requiring a re-bridging facility for an exciting development opportunity on an industrial estate in Hertfordshire.

The site already had existing planning permission for a 124-bed hotel, but the client had identified a more lucrative opportunity and was seeking amended planning permission to develop a substantial 300-unit co-living scheme instead.

This ambitious project required a £4.225 million loan facility to bridge the gap whilst the planning amendment process was completed. The client needed a financing partner who could see the potential in their vision and support them through the planning transition period.

What was the issue?

The primary challenge our client faced was finding a lender willing to take a positive view on the amended planning permission application. Many traditional lenders were hesitant to provide financing when planning permission was still pending, particularly for a significant change from hotel use to co-living accommodation.

The uncertainty around planning approval timelines and the relatively new co-living sector made several lenders reluctant to engage with the project. In addition, our client had been turned down by multiple institutions who couldn’t look beyond the current planning status to see the development’s potential.

What was the process?

Drawing on our extensive network of specialist lenders and deep understanding of the development finance market, we identified lenders who had experience with this type of transaction and were comfortable with co-living schemes.

We prepared a comprehensive presentation highlighting the site’s potential, the growing demand for co-living accommodation, and the client’s development track record. Leveraging our strong lender relationships, we successfully negotiated favourable terms, including a reduced interest rate and minimised personal guarantee requirements. We went above and beyond by conducting detailed market research to support the application and maintaining regular communication with all parties throughout the process.

What was the solution?

We successfully secured a 65% Loan-to-Value (LTV) facility at an excellent rate given the circumstances and market conditions.

This solution provided our client with the breathing space needed to navigate the amended planning permission process without financial pressure. The facility means they can now focus on securing the co-living planning consent whilst having the development funding already in place, putting them in a strong position to move quickly once approval is granted.

The client was delighted with both the competitive terms achieved and the smooth, professional process we delivered throughout.

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