Britain’s medium-sized businesses continue to play a central role in productivity and job creation, yet many property developers say the move from a small operation to a mid-sized business brought heavier pressure than expected.
New research from Shawbrook revealed that expansion often stretches both finances and founders themselves.
More than half of developers, 51%, said they underestimated the financial demands of scaling. The pressure extended beyond cash flow as businesses grew more complex. Almost a quarter, 23%, experienced moments of isolation during their scale-up journey, while 20% reported higher stress levels as operational demands increased.
Developers also put significant personal resources on the line to support growth. Nearly half, 46%, used personal savings or remortgaged property to fund expansion, reflecting the degree of personal commitment behind many mid-market businesses. Despite the strain, growth delivered results for some. Revenue growth eventually outpaced rising costs for 38% of respondents, suggesting that early financial pressure can translate into stronger performance over time.
Access to appropriate finance remains a challenge. Around 30% of property developers struggled to secure funding that matched their stage of growth. Many described a gap between start-up support and corporate banking, leaving medium-sized businesses with limited specialist options as they scale.
When asked what would make growth more sustainable, developers highlighted several areas where targeted support could ease the burden:
Help navigating regulation and compliance, cited by 33%.
Decreases in national insurance, mentioned by 32%.
Recruitment and talent acquisition support, selected by 28%.
Access to tailored finance or funding, highlighted by 27%.
Terry Woodley, managing director of development finance at Shawbrook, said, “The property development industry is vital to the UK’s economic strength, and developers are clearly willing to back their ambitions with significant personal commitment.” He continued, “Their success shows what is possible when businesses scale well – but it also highlights where more tailored support could unlock even greater growth.
“With red tape and a depleting workforce being the biggest barriers to property developers, it’s crucial that they are given support to continue scaling up, whether this is through legislative changes or funding opportunities. The industry continues to be ripe with potential; it just needs the proper tools to flourish.”
