Loans to assist experienced developers to buy sites with strong planning potential. Usually restricted to about 65% of current value.
This is bank finance, usually up to 60% of Gross Development Value
Stretched senior debt is bank finance plus mezzanine finance which replaces some of the developer’s equity. Stretched senior debt is provided by a single lender up to 75% of GDV
Useful for topping up senior debt, for example:
|£650,000||senior debt - secured by a first mortgage|
|£200,000||mezzanine finance - secured by a second mortgage|
|£150,000||borrower's own equity|
|£1,000,000||Total Project Cost|