Lendhub has announced that it has completed £2.1m of development finance for a 15-unit scheme in Addlestone, Surrey.
The facility funds the acquisition and refurbishment of a 12-flat apartment block, together with the construction of three additional units through a rear extension that already has planning permission. Adam Klein of Atlas Property Finance introduced the deal.
The single 18-month development finance facility combines a medium refurbishment of the existing flats with the build of the new units, and the scheme has a projected GDV of £3m on completion.
Lendhub structured the facility as follows:
- 67% LTV on day one and 70% LTGDV, with interest rolled up over the 18-month term
- a £1.05m day-one advance to fund the acquisition
- an £822,000 build tranche, drawn in stages across the refurbishment and development programme
The borrower is buying the property with full planning consent in place for a three-storey rear extension that will create three new residential units. The consent also covers façade alterations and associated parking, landscaping and servicing works. Jack Glendinning of Lambert Smith Hampton carried out the valuation, and IESIS Consult acted as monitoring surveyor.
Lendhub says it has seen growing demand for this structure among value-add residential investors, who use one development finance facility to refurbish existing flats and add units on the same site.
Rather than running separate bridging and development lines, the lender sized the facility to cover both workstreams in parallel, with drawdowns tied to the refurbishment programme on the existing block and the construction programme on the extension. The combined scheme is projected to lift the asset value from £1.56m on entry to just over £3m.
“The borrower had two jobs on one site: refurbish the existing 12 flats and build three new units at the back,” said Dan Margolis, relationship manager at Lendhub. “Packaging it as one facility rather than two was the right commercial call, but it needed credit, the broker, and the monitoring surveyor aligned from day one.”
“The client needed a lender willing to look at the whole site rather than splitting the refurb and the new build into separate facilities,” noted Klein. “Lendhub engaged with the combined structure from the outset and matched the pace required to complete on the acquisition.”
If you’re exploring bridging or development finance, get in touch and we can connect you with the right lender.
