Hodge has launched two new commercial finance options, an Acquisition Bridge and a Sales Bridge, aimed at helping experienced SME developers and brokers who specialise in development finance.
The Acquisition Bridge will help developers move quickly to buy land or property, affording the borrower time to improve or perfect their planning consent or change of use. It is a short term finance product for developments with or without detailed or proposed use planning consent, where a change of planning permission or use is required, or for agreed developments that aren’t planned to start for six months. Hodge can then provide longer term development finance for the next stage of the project.
The Sales Bridge product will be available to existing Hodge Development Finance customers only. It is another short term finance option available for developers as they come to the end of a project, allowing them to release equity from the development in order to secure a new development site opportunity, return equity to investors early, or free up funds whilst the asset sales are going through.
Gareth Davies, head of development finance at Hodge, said: “We understand that development finance needs flexibility. Sometimes there are opportunities that developers want to jump on quickly or that situations may arise that the developer wasn’t expecting and so we’ve created these new options to help our clients and brokers bridge those gaps.
“The Acquisition Bridge product will allow developers and brokers to access funds more quickly than traditional development finance and in situations where a planning consent may not yet have been achieved, with the potential to convert to a Hodge development finance facility in due course.
“The Sales Bridge product will help our existing developer customers access increased term and additional leverage, upon practical completion, should it be required. Affording increased flexibility and greater options at a time when equity can be tied up in completed units.”
Hodge’s Acquisition Bridge product is available to experienced residential property developers, including partnerships, LLPs and limited companies. Loans available range from £250,000 to £5million, with the LTV dependent on the asset and planning permissions in place with a term from 6 to 24 months.
The Sales Bridge product is available for current Hodge Development Finance customers only, with a loan amount available of between £250,000 to £5million. Maximum LTV is 75% of gross development value (GDV) with a term of up to 12 months.
Davies added: “We believe the addition of these products to our portfolio will mean Hodge can help property developers at every stage of a project, ensuring that opportunities aren’t missed at either end of the development cycle.
“Whether it be at the buying or the selling stage, we have designed these bridging options to give developers more breathing space at the beginning and end of a project.”