The contract for the project – which was brokered by Crystal Specialist Finance (CSF) and funded by Manchester-based lender Affirmative – required the removal of several dilapidated buildings prior to the construction of new residential houses.
The deal took more than two years to complete, with the 300mm long by 150mm diameter bomb just one of obstacles faced by KAD Developments.
CSF first became involved in June 2017 after the applicant was let down by another lender.
Due to initial limited funds, a deal was negotiated with the landowner to defer part of the payment until completion but after approaching a number of lenders, a lack of experience and upfront payment seemed to be a problem.
A few months later the client provided additional security and Affirmative agreed to offer the £240,000 balance of funds with the £60,000 build costs to be funded in arrears.
During the legal process the seller reneged on the deal which put it on hold once again but in November 2018 an equity partner agreed to make up the shortfall. Affirmative agreed to honour the original offer and use the existing valuation with the funds finally released in April 2019.
With the World War Two bomb safely removed, the development is now on track, with a local estate agency valuing the new houses above the initial £1.5m gross development value.
Michael Fisher, head of development finance at CSF, said: “This application encountered a minefield of issues, but by working together and continuing open dialogue we were able to assist the client through every setback to ensure he could complete the deal.”
Affirmative head of sales Ian Harrison added: “It’s not the type of loan you see every day, but we love it when quirky cases like this come across our desks. It was a pleasure working with Crystal to get the customer the deal they needed, and we look forward to working with them in the future to help other customers with a flexible lending solution.”