100% development finance for viable UK property schemes
I compare senior debt, mezzanine and additional security against cost, equity and exit before choosing finance for my development scheme.
My development funding structure
I define what “100%” refers to before comparing lenders. Purchase price, total project cost, current value, gross development value, existing equity and additional security lead to different structures.
Vortex compares suitable debt routes and packages the selected application. It does not promise that every scheme can be funded without cash equity.
100% development finance
100% development finance can refer to full purchase cost, full build cost or total project cost. Those are different claims. The funding basis must be stated before the structure can be assessed.
A senior lender can require borrower equity even when another layer or additional security closes a cash gap. Fees, interest and contingency can also sit outside a headline percentage.
I compare the complete sources and uses of funds. A viable structure shows who funds each cost, when money is released and how every layer is repaid.
Senior debt and mezzanine finance
Senior debt holds the first-ranking position over the development security. Mezzanine sits behind senior debt and carries greater repayment risk, subject to intercreditor and lender requirements.
Combining the layers can increase total funding, but it also increases interest, fees and legal complexity. The senior and mezzanine terms must work together on drawdowns, monitoring, default and exit.
I compare the blended cost and repayment balance against the scheme appraisal. Vortex does not present mezzanine as free equity or automatic approval.
Development finance additional security
Additional security can support a higher overall facility when another property has acceptable equity. The lender assesses value, existing charges, ownership, use, title and saleability of every asset offered.
A cross-collateralised loan places more than the development site at risk. Existing lender consent or a priority arrangement can also be required.
I map gross facility, debt repaid, deductions and usable cash across all security. The benefit of extra funding is weighed against the additional property exposure.
Development finance borrower equity
Borrower equity can come from cash, site value already owned, eligible costs already paid or another lender-accepted source. The source and timing need evidence.
I separate genuine equity from future profit, unconfirmed valuation uplift or money that must itself be repaid. The lender and solicitor check source of funds.
A low-cash structure can still require money for fees, tax, early costs, overruns or non-funded items. The cash flow should expose those needs before commitment.
Development loan to cost
Loan to cost compares eligible development borrowing with the cost base accepted by the lender. The accepted base can exclude some finance, tax, professional or acquisition items.
I provide a detailed cost plan showing purchase, construction, professional, statutory, finance and contingency items. The lender decides which costs qualify and which evidence is required.
Loan to cost does not show the whole risk. The lender also tests value, profit, borrower equity, experience and exit.
Loan to gross development value
Loan to gross development value compares borrowing with the supported value of the completed scheme. The valuation depends on approved design, tenure, unit mix, market evidence and sales or rental assumptions.
I test the loan against current value, gross development value and expected repayment. A higher projected value does not automatically create more day-one cash.
The valuer and lender control the accepted figure. Sensitivity to lower value or slower sales belongs in the appraisal.
Development cost plan and contingency
The cost plan is the operating budget for the facility. It should cover works, professional fees, statutory costs, utilities, site setup, finance and other scheme-specific items.
Contingency protects the programme from defined uncertainty. It is not a substitute for missing scope or an unsupported contractor price.
I align the cost plan with drawings, programme, procurement and cash flow. The lender can require monitoring surveyor review before credit approval and throughout the build.
Development staged drawdowns
Development finance is commonly released in staged drawdowns after the initial advance. Each request can depend on progress, cost evidence, monitoring and satisfaction of conditions.
I model the timing of works, equity, draw requests, interest and invoices. A facility that covers total cost can still leave a temporary cash shortfall when draw timing and contractor payments do not align.
The loan structure should state whether funding is advanced in arrears, against certified value or under another agreed method.
Development finance interest and fees
Cost can include interest, lender fees, valuation, monitoring, legal costs, broker charge and exit or extension provisions. Interest can be charged on drawn funds, committed funds or another basis stated in the agreement.
I compare the blended cost across senior debt and mezzanine rather than reading each layer alone. Vortex discloses its broker charge and lender commission before commitment.
Cost is tested against profit and cash flow. An additional funding layer can protect liquidity while reducing the developer’s residual return.
Development team and property experience
The lender assesses property experience against the scale and complexity of the scheme. Previous developments, contractor record, professional appointments and delivery responsibilities matter.
A first-time developer can require a stronger team, more equity, simpler scheme or additional oversight. No one factor guarantees acceptance.
I present completed projects, relevant roles and the professional team accurately. The lender can check references, financial standing and appointment terms.
Development finance documents
Documents can include title and purchase papers, planning, drawings, cost plan, programme, appraisal, valuation information, professional appointments, contractor details, company records, equity evidence, experience and exit support.
I check that areas, unit numbers, costs, values and dates agree. Conflicting versions weaken underwriting and monitoring.
Vortex packages the application and tracks conditions. The lender makes the final decision after credit, valuation, legal and monitoring review.
Development finance exit strategy
The exit strategy can rely on unit sales, investment refinance, development exit finance or another supported repayment source. It should cover the full expected balance and allow for time and cost.
A sales exit needs realistic pricing, demand and absorption. A refinance needs rent, value, property completion and borrower evidence that may fit the next lender.
I include a fallback when the main exit depends on market conditions or remaining works. A full-cost structure without a credible exit is not viable funding.
100% development finance questions
Does 100% development finance mean no cash is required?+
Can senior debt and mezzanine be combined?+
Can additional property support the facility?+
Can a first-time developer apply?+
Who approves the final structure?+
Mezzanine finance
Review the subordinated debt layer, blended cost and intercreditor position.
Read the finance route ›Development finance requirements
Prepare the scheme, borrower, equity, cost plan, team and exit evidence.
Read the finance route ›Development exit finance
Compare refinance after practical completion or near completion.
Read the finance route ›Compare the funding structure for my development
I provide the site, costs, values, equity, security, team, draw profile and exit. Vortex compares suitable development debt structures and packages the selected application.
Request my free development finance quote