The acquisition bridge is a short-term finance product which aims to help developers to buy land or property quickly. It is available on developments with or without detailed or proposed use planning consent, where a change of planning or use is required, or for agreed developments that are not set to start for six months.
Hodge will then offer longer term development finance for the next stage.
It is available to experienced residential property developers, including partnerships, LLPs and limited companies. Loans available range from £250,000 to £5m, and the loan to value (LTV) is dependent on the asset and planning permissions in place. It has a term from six to 24 months.
The sales bridge is open to existing Hodge development finance borrowers only. It is also a short-term finance option and is available to developers coming to the end of a project. It enables them to release equity from the development to secure a new site, return equity to investors early, or free up funds while the asset sales are in progress.
This option offers loans between £250,000 and £5m. The maximum LTV is 75 per cent of the development’s gross development value with a term of up to 12 months.
Gareth Davies (pictured), head of development finance at Hodge, said: “We understand that development finance needs flexibility. Sometimes there are opportunities that developers want to jump on quickly or that situations may arise that the developer wasn’t expecting and so we’ve created these new options to help our clients and brokers bridge those gaps.
“The acquisition bridge product will allow developers and brokers to access funds more quickly than traditional development finance and in situations where a planning consent may not yet have been achieved, with the potential to convert to a Hodge development finance facility in due course.
“The sales bridge product will help our existing developer customers access increased term and additional leverage, upon practical completion, should it be required. Affording increased flexibility and greater options at a time when equity can be tied up in completed units.”
Davies said the products meant the lender could help property developers at every stage of a project, so opportunities were not missed at any part of the cycle.
He added: “Whether it be at the buying or the selling stage, we have designed these bridging options to give developers more breathing space at the beginning and end of a project.”