Securing finance for a development site in rural Scotland

What was the situation?

The clients purchased a development site in rural Scotland three years ago. The site had planning permission to build a number of residential units, so they wished to raise debt against the site in order to enhance the planning further and provide cashflow to complete other ongoing development projects within their pipeline.

What was the issue?

Due to the location of the site, there is limited appetite from funders willing to lend on land with planning in rural Scotland.

What was the process?

The clients had a preference to use a certain surveyor with whom they had worked with in the past, and who had already provided commentary on the expected value of the site prior to formal instruction. To adhere to their request, we selected a lender who was comfortable using this valuer, therefore providing reassurance to the client and minimising the risk of a down-valuation.

What was the solution?

As the site already had planning permission in place, we chose a lender who would consider the full market value of the site which included the value-added from the planning permission. This allowed us to obtain the leverage amount the client required to fund the other development projects in their pipeline. The rate secured was market leading at 0.95% per month and the monthly interest was retained within the facility to ensure that the clients’ cashflow was maximised throughout the duration of the loan.

The application progressed smoothly and completed within a month from application to completion and drawdown of funds.

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