Atelier releases lending framework for modular and offsite developments

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  • 04/04/2023
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Atelier releases lending framework for modular and offsite developments
Development lender Atelier has launched a finance framework for developers setting up projects with the use of offsite and modular construction techniques.

This follows an industry-wide consultation completed by the lender with professionals and trade bodies in the modular and offsite manufacturing sector. It will detail the benefits and challenges attached to these developments. 

The framework also comes after research from Savills predicted that a fifth of all new homes will be built using these methods by 2030. 

Atelier said projects developed in this way had so far been under-served by development finance lenders. 

The lender has also created a guide for SME developers and intermediaries which includes its lending and eligibility criteria where offsite and modular technology is used.  

This will run alongside its Carbonite Challenge, which is a range of finance that was launched in 2021 to incentivise developers to create greener and more sustainable homes. 

Atelier will offer loans between £5m to £40m, up to 70 per cent loan to gross development value (LTGDV) for qualifying projects. 

 

Transforming residential property development

Chris Gardner (pictured), joint CEO at Atelier, said offsite construction technology had the “potential to transform residential property development”, adding: “It’s time for that potential to be turned into reality, and that’s why Atelier is determined to help developers build more homes this way.” 

Gardner said: “We’ve collaborated across the construction industry, incorporating the expertise of more than 30 leaders in offsite technology to give developers, intermediaries and contractors a clear and practical guide to the opportunities and challenges that these new ways of building offer. 

“Above all, we’re working to be the lender of choice for developers who decide offsite is right for them – a trusted, expert partner who understands the technology and can provide reliable finance, a competitive interest rate and ongoing support, right through to the successful completion of their scheme.” 

The lender worked with the National House Building Council (NHBC) and Buildoffsite Property Assurance Scheme (BOPAS) during the development of the framework. 

Chris Hall, innovation services manager at NHBC, said: “The potential benefits of offsite construction are clear; consistent build quality, reduced costs and time on site, and strong sustainability credentials. More developers are considering these modern methods of construction, and that’s why Atelier’s lending framework is so timely.  

“By making it easier for residential developers to incorporate offsite technology into their plans, and by providing the finance and support they need to build their schemes successfully, Atelier is addressing market challenges in a clear and concise way.” 

Terry Mundy, BOPAS consultant, added: “For all the good work that has gone into raising industry standards in the design, manufacture and installation of offsite construction systems across the UK, one of the challenges that has proven harder to overcome is reassuring lenders to provide finance for such offsite schemes.  

“By introducing its offsite and modular construction lending framework, Atelier is now raising the bar in the development finance sector, to facilitate the positive shift towards modular and offsite construction.” 

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