MDA Consulting is a construction monitoring consultancy and contributed to the publication of Building Safety Levy: Implications for Lenders & Monitoring Surveyors.
The Building Safety Levy is expected to raise around £3.4bn over 10 years to remediate unsafe buildings through developer contributions.
The white paper includes information for developers, lenders and monitoring surveyors with guidance on regional rate structure, Gross Internal Area (GIA) calculations, brownfield discount criteria and transitional exemption windows.
The Building Safety Levy applies to all major residential developers in England with 10 or more dwellings, or 30 or more purpose-built student accommodation (PBSA) bedspaces.
The levy applies regardless of building height.
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Regional rates will depend on factors such as a property’s location and development type, ranging from £12.70 per square metre in County Durham to £100.35 per square metre in the Royal Borough of Kensington and Chelsea.
Schemes constructed on previously developed land (PDL) may be eligible for a 50% rate reduction, as long as at least 75% of the consented site meets the statutory PDL definition. The white paper gives details on how to verify and gather evidence to obtain the discount at underwriting.
Further, the levy is paid through a single upfront cost before the first completion or occupation certificate is issued. The white paper warns that failure to accurately budget or fund the levy will result in authorities withholding completion certificates, which can block unit sales, refinancing and loan redemptions.
The white paper also explains that building control applications submitted before 1 October 2026 are exempt from the Building Safety Levy, as long as works have substantively begun on site within three years of the initial application.
Dan Lohn, relationship manager at LendInvest, said: “As property development lenders, our role extends beyond providing capital; it’s about offering certainty as developers navigate major regulatory shifts like the Building Safety Levy.
“With the levy directly impacting scheme viability, cash flow timing and completion sign-offs, proactive partnerships are essential. By joining forces with MDA Consulting, LendInvest is delivering practical clarity on complex calculations, brownfield exemptions and adapted funding structures to help SME developers manage these obligations and keep projects moving forward securely.”
Chris Chadwick, director at MDA Consulting, added: “Where much of the post-Grenfell reform agenda is procedural, the Building Safety Levy is a direct cash cost sitting on every qualifying scheme’s balance sheet. Calculated on measured floorspace and varying by local authority, its mechanics demand disciplined, stage-by-stage verification so costs are not overlooked.
“In collaboration with LendInvest, MDA is sharing practical guidance to help lenders, developers, and surveyors successfully manage this shared financial risk from initial appraisal right through to final completion certification.”
