Silbury Finance, the Oaktree Capital Management-backed development lender, has provided a £39 million senior loan to Stonegate Homes, the residential developer focused on brownfield site regeneration in the Homes Counties.
The 12-month facility, at 90% Loan to Cost, will fund the acquisition of a 20-acre brownfield site in Dorking, Surrey, where Stonegate Homes has secured planning to develop an initial 226 homes for sale.
It represents the second loan that Silbury has provided Stonegate Homes and was completed in 15 working days, with Silbury stepping in following another lender’s inability to complete on the purchase.
The key strategic site, as outlined by the Local Planning Authority, is known as Pixham End. Alongside converting a former office building owned by Aviva Investors into 226 homes under Permitted Development, as part of Stonegate Home’s wider masterplan for the site, planning applications have been submitted for an additional 41 townhouses, a large retirement living development and 8,000 sq ft of commercial space.
Since launching in January 2021, Silbury has originated 16 loans totalling £618 million of new finance across the retirement living and build to sell sectors, to 12 different borrowers, with a Gross Asset Value of c. £918 million.
Gavin Eustace, founding partner at Silbury Finance, said: “The impact of the current macro volatility and higher interest rates isn’t confined to sponsors, with lenders increasingly being forced to withdraw or retrench from the market. This presents an opportunity for highly experienced and nimble lenders with funding certainty like ourselves, to step in and partner with credible real estate developers, with the secured pipelines to continue bringing forward much needed residential-led schemes across the UK.
“Working with repeat borrowers is central to our strategy and we are excited about extending our relationship with Stonegate Homes as we target £1 billion of lending by the end of 2023.”
Jerry Hinds, managing director of Stonegate Homes, added: “I am delighted to have worked alongside Gavin and the wider Silbury Finance team to complete on the unconditional acquisition of Pixham Mills, a prime 35 acre site in the heart of the Surrey Hills. This is our largest unconditional purchase to date and I cannot thank the Silbury team enough for all their hard work in concluding this in such a short period of time, in what are hugely challenging financial times.
“We look forward to a continued working relationship on this site as well as other exciting projects moving forward.”
