Hodge launches two bridging loans for experienced developers

Hodge has launched two bridging loans aimed at experienced small business developers and brokers specializing in development finance.

The bank says its acquisition bridge offering is a short-term financing product for developments with or without detailed or proposed use planning permission, where a change in planning or use permit is required, or for agreed developments not to begin for six months.

It says the loan can “help developers move quickly to purchase land or property, giving the borrower time to improve or perfect their planning consent or change of use.”

Its Acquisition Bridge product is available to experienced residential real estate developers, including partnerships, LLPs and LLCs. Loans range from £250,000 to £5 million, the loan-to-value ratio depending on assets and planning permissions in place, with tenors ranging from six to 24 months.

The lender adds that the continuation of this loan can provide longer-term development funding for the next stage of the project.

The bank’s second product is the Sales Bridge, another short-term financing product available to developers at the end of a project, allowing them to release capital from development to secure a new development site opportunity, return capital to investors early or release funds as asset sales progress.

The Sales Bridge product is only available to the company’s existing development finance customers, with a loan amount also between £250,000 and £5 million. The maximum LTV is 75% of the gross development value with a maximum duration of 12 months.

Gareth Davies, Head of Development Finance at Hodge, said: “We understand that development finance needs flexibility. Sometimes there are opportunities that developers want to grab quickly or situations that the developer did not expect can arise. So we’ve created these new options to help our clients and brokers fill those gaps.

“The Acquisition Bridge product will allow developers and brokers to access funds faster than traditional development finance and in situations where planning consent may not yet have been obtained, with the ability to convert to a Hodge Development Finance Facility in due course.

“The Sales Bridge product will help our existing developer customers gain access to increased lifespan and additional leverage upon completion, if needed. Provide increased flexibility and greater options at a time when equity can be tied up in completed units. »

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