Development finance was high on the agenda at Aldermore’s annual conference, where brokers were invited to learn about the lender’s development products and how best to submit an application for quick approval.

Since re-entering the development market after its initial launch 18 months ago, Aldermore’s product offering is now on track to compete with some of the most high profile lenders in this space; the division’s team – headed by Peter Owen (Senior Property Development Manager) with Simon Knowles (Property Development Manager) and Simon Green (Property Development Manager) – have ambitious lending targets for the year ahead.

Setting out the product parameters, Simon Green explained that the product is on offer to experienced developers only and primarily for residential developments.

The product is also available for mixed use developments but the GDV of the commercial element must not be more than 25 per cent of the property’s overall value; Aldermore will only lend once planning permission has been obtained.

There is a minimum loan size of £0.5m and maximum of £5m, with a maximum loan term of 24 months. 

The product offers a fixed standard rate at 10 per cent which will be charged as the loan is drawn down on a rolled up basis. 

The arrangement fee is 2 per cent, of which 0.75 per cent can be passed to the broker.

Developments located in the Midlands or South/South East will be suitable for the product with other locations accepted on an exceptional basis only – the product is not available for developments in Scotland.

Aldermore will lend to sole traders, partnerships and off-shore companies (located in the Channel Islands) and will ask for personal guarantees.

To ensure a decision is returned in the quickest time, Aldermore requires:

- A comprehensive outline of the client’s past and present development projects;

- A financial appraisal and demonstration of cash-flow;

- Planning consent and plans;

- Three months of bank statements;

- Financial accounts; 

- Asset and liability statement;

- Market report showing exit route options (this may require liaison with local estate agents to ascertain exactly who your target market is). 

Simon Knowles explained that a more detailed document submission is required for large developments and brokers should contact the team direct to submit their client’s case.

In addition, a number of recently approved facilities were highlighted to show the variety of developments that Aldermore is willing to fund.

Commenting on the presentation, Simon Knowles, Property Development Manager at Aldermore, said: “The event provided an excellent opportunity to give a large number of our business introducers further insight into how Aldermore can assist with development finance proposals. 

“A presentation consisting of an overview of our development product and some example case studies was followed by a very interactive question and answer session. Judging by the ever-growing number of enquiries received after the event, the answers to those questions were obviously very well received!”