Successfully Funding Thousands Of UK Limited Companies Since 1989
Require Immediate Support? Helpline 0800 056 0410
Commercial property development finance provides the funds for property developers to purchase and develop business premises to ultimately sell or rent commercially on completion.
The funds can be used to pay for land and building and development costs as well as legal and other administrative fees that are associated with the process. This type of finance is typically offered by lenders on a short-term basis of between 12 and 36 months.
Financiers will estimate the value of the completed project and offer a loan based on that and other factors, including the developer’s experience. Funds are released in stages so that if you’re using the financing to purchase land, the lender will release this first.
Property development loans are usually paid back once the project is complete, with interest generally being charged only on those funds released rather than on the entire loan.
The staged release of funds means that financing is made available as you move through the development project so you only pay interest on the amount received. Interest can also be added to the loan in some cases, so it doesn’t become payable until the project is finished.
A further benefit is the speed with which this type of funding can be secured. It’s generally fast to obtain and so provides the momentum you need to push your commercial property project forward.
A potential disadvantage of commercial property development loans is that some lenders charge higher interest rates. This is typically due to a range of factors, including the high loan amounts provided and the speed with which they’re made available to commercial borrowers.
To find out more about funding your commercial property development, please get in touch with us at UK Business Finance. We cover the whole of the market and can ensure you have access to the best deals.
We work across a wide range of sectors throughout the UK, providing specialist advice to each sector.
What are my options if I need business finance urgently?
Regardless of how closely you monitor your company’s cash flow, the nature of business means you may still need finance urgently at some point.
What is equity finance?
Equity finance is a business funding option that involves selling shares in return for investment. It’s commonly used by start-ups or early-stage company directors wishing to get their businesses off the ground and propelled towards rapid growth.
Hard asset finance v Soft asset finance
Hard asset finance and soft asset finance both offer flexible ways to purchase business assets. Whether you need a new piece of machinery to increase output or state of the art IT equipment, these types of asset finance options are invaluable in buying them affordably.
Regulated v Unregulated bridging loans – what’s the difference?
Bridging loans are finance facilities that help consumers and businesses to complete property transactions when a financial ‘gap’ needs to be bridged. Examples include a consumer purchasing a new home to live in and a business investing in commercial property.