This will be available for enhanced or modified planning and is expected to give developers the certainty that funding will be approved if they make planning changes in the future.
The feature can be applied in cases where the developer may have finalised plans to add an additional storey to a property and has already submitted an application.
In this scenario, Avamore can add an extra discretionary facility to the loan agreement which means further funds can be drawn subject to planning being granted.
The feature can also be used where a developer is converting a building with intention to submit planning to add another storey which they have estimated costs for, but not finalised plans.
Here, Avamore will include an estimated discretionary facility in the offer for the expected works. To draw the additional facility, finalised plans must be approved by the lender and final planning must be granted.
The final scenario in which the feature can be used is where the developer may have been granted planning by the local authority subject to a s106 agreement being signed and provided by the borrower. In this case, the formal planning consent may not have been issued and take time to come through.
In this instance, Avamore can accept that planning has been granted in principle. It will provide the loan for the full works with the build facility being released at the point which planning is gained in full.
There are no additional fees charged if the developer does not use the facility and rates will be in line with Avamore’s standard offering.
Only refurbishment projects will be eligible for the feature.
Adam Butler, relationship manager at Avamore Capital, said: “We have lent on a number of projects that fall into the planning flexibility bracket and it’s great that we are now able to formalise the feature.
“This is another element for brokers to add to their toolbox which speaks exactly to what developers need right now.”
He added: “The market is keen to build and Avamore’s feature mitigates the ‘stop start’ nature of the process. If the enhanced planning is packaged in the initial deal, once planning is approved, we really facilitate the developer’s ability to move at pace.”