Mezzanine funding for new build and heavy renovation projects from £100,000 to £2,500,000

Mezzanine finance is where a loan is provided to a developer to sit alongside a senior loan and in the second charge position. Typically, the senior lender will fund around 60% of the costs and then the mezzanine provider can top that up to 90%, meaning the developer only has to commit 10% of the costs in equity (rather than the 40% if there was just the senior loan in this example). Our mezzanine loans are available alongside a panel of approved senior lenders and we will always consider new lenders on a case-by-case basis.

Mezzanine finance allows a developer to spread their finances whilst at the same time doubling the potential return on capital and increase property development capacity. With mezzanine funding, developers can move onto their next development while still completing current projects as they must commit less equity into a single project. This can provide developers with a critical advantage at a time when competition for good sites is extremely high. In addition to increasing development capacity by carrying out two to three developments in the same period (with staggered commencement dates) the developer can spread their risk over more than one project at any given time.