Blend launches exit bridge product for developers

The lender said the market was experiencing a sales slowdown, which meant some lenders did not want to carry forward a completed project when the loan was about to expire, or were not able to. 

The exit bridge product aims to address this problem by allowing developers to carry a project until a price sale is achieved. 

It is open to property developers with completed residential developments who are facing the expiry of their existing loan with a lender that does not want to extend this. 

Developers can borrow between £500,000 and £5m with the bridge product, with loan to values (LTVs) of 70 per cent and 75 per cent. This is priced at 0.95 per cent to 1.1 per cent per month. Blend may also allow developers to release equity to fund their next project, in some cases. 

This product launch follows the announcement that Blend had obtained a £50m-plus institutional funding line to provide bridging finance to developers.

Yann Murciano, CEO at Blend, said: “For the past seven years, Blend has been supporting mid-size property developers across the UK, and we are very proud to say that we’ve never had to appoint a receiver on any of our developers. Have there been issues with the projects we’ve funded? Yes, undoubtedly.

“But our business model is based on supporting developers and working with them, not against them. So, where our developers have faced issues with their schemes, we have worked closely with them to find solutions that help them overcome the challenges. That collaboration has been, and continues to be, the cornerstone to our business, and is the reason we see repeat developers wanting to work with us.” 

He added: “The past 18 months have been very challenging in the market. We are seeing a lot of extensions and are speaking with many developers with facilities that are coming close to expiry. 

“The launch of our new bridge sends a strong message to those developers: we want to work with you and support you. We want to give you enough time to market your property at the right price, rather than having to fire sale or face the expiry of your facility, which often comes with extremely high default rates and fees.”