In an ever more competitive housing market – with land values at a premium – successful property developers continue to look for ways to maximise their returns on every project.
When all horizontal elevations have been maximised, the only options are up or down. While this can create fresh challenges for a developer, it can be a financially rewarding experience.
Beyond the form
Our borrower’s proposition was to develop the flat roof of a former commercial office building (now successfully converted to apartments with the project fully sold out). Other lenders within our sector were approached, but the client’s broker was met with a lot of head shaking, as they were daunted by the complexity of the project. After all, there’s no space on a form that fits the criteria he had in mind: the development of eight luxurious penthouses on the flat roof of a former office building on the outskirts of a city centre.
Although the borrower is a seasoned developer with plenty of successful refurbishments and conversion projects in his portfolio – including the project which we were being approached to develop – he didn’t have experience in the type of project proposed.
At Mint, we like to meet our borrowers, so when I visited the developer, I could see the merit in what he was trying to do. Richard Showman, senior underwriter, said: “I remember when Andrew advised us that he’d agreed to fund a loan on a leasehold flat roof of a commercial property. I thought his entrepreneurial flair had finally got the better of him, but once on site, I could see its potential and felt it was worth our support.”
Field experience
The Mint management team are successful developers in their own right and have a track record of delivering developments of various sizes. Thanks to this knowledge, we are in a great place to provide visionary borrowers with a handmade solution, based on their unique needs.
With our support, the borrower was able to proceed with his plan of creating purpose-built (timber frame) pods on three rooftops. We introduced our own quantity surveyor – who had experience in this type of development – to the developer’s own project team to offer assistance as well as to manage our further advances. The developer now had an extra tier of expertise on hand to monitor the building’s progress.
As the client was the freeholder, no consents were required to progress the development when planning permission was attained. The payments were staged and released to the client, allowing him to call upon funds when required to progress the project. The client, therefore, only paid for funds utilised, but had the comfort that the money was at his disposal.
The borrower said: “When we were turned down by other bridging and development lenders, we were introduced to Mint Bridging by our broker. When Andrew came on site, he offered us terms there and then.
The funds were drawn down soon after, and working with their QS [quantity surveyor] was seamless. I would have no hesitation to use them again for our next project or to recommend them to anyone looking for a reliable, honest, trustworthy lender with a ‘can-do’ attitude.”
Our entrepreneurial spirit is derived from the knowledge and experience that exists within our team. Where we feel a project has the potential to be viable – even if it seems outwardly complicated – we will invest time and effort to understand it on its financial and practical merits. By doing this, we can tailor a handmade solution that works for all parties.
We’re financially independent and this allows us to write loans or fund developments of up to £5m. In addition, we have the in-house skills and experience to support a borrower with every aspect of their development or project.
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