Paragon announces development finance team changes
Robert Orr (pictured) will step down from his current role as managing director and be succeeded by deputy managing director Neal Moy, who joined Paragon Development Finance in October 2021.
Orr will remain within the business in a part-time role as senior adviser to the development finance team.
Paragon Development Finance has expanded significantly since the Paragon Banking Group acquired development finance specialist Titlestone for £48m in July 2018.
The relationship director team has grown over 200 per cent, while the division recorded a 41 per cent increase in advances during the first half of Paragon’s latest financial year. The division lent £323.7m during the six months to the end of March, compared to £229.5m during the same period in 2021.
The division’s loan book ended the period at £672.9m, compared to £552.3m the year before.
Orr said: “I’m reaching the milestone of 40 years full-time working this September and always had in mind that this would be a good time to have a change in my work/life balance. I’m really proud of what we have created at Paragon since its acquisition of Titlestone four years ago and no doubt I’ll miss the buzz of leading this great business.
“But I’m delighted to still be involved with Paragon going forward in an advisory capacity and, having worked closely with Neal over the last nine months, I know that development finance is in good hands under his leadership.”
Neal Moy was the founder and managing director of the RateSetter Development Finance business before it was acquired by Shawbrook Bank in 2021. He has also held real estate positions at RBS, Lloyds and Deutsche Postbank in a 30-year property career.
Moy added: “Robert has done an amazing job in growing the development finance capabilities of Paragon over the last four years. During this time, he has built a strong team, enhanced the product range, and established a business with an excellent reputation for delivery. I’m excited to be taking over from him and leading the business forwards.”
Dave Newcombe, managing director of Paragon Bank’s commercial banking divisions, said: “Robert’s passion for delivering a first-class service to our clients is engrained within the strong team he has developed, and he hands over a business that has delivered year-on-year lending growth since Paragon’s acquisition of Titlestone.
“Whilst Robert is stepping down from running the business on a day-to-day basis, I am delighted that he has agreed to continue to support the Development Finance business as a senior adviser. I am also delighted that Neal Moy, who has a wealth of experience in the development sector, is moving up to be our new managing director.”
Hampshire Trust Bank appoints development finance lending director
He brings over 10 years’ experience in the development finance sector, having started his career at Natwest.
Dignum joined Natwest in Manchester as a graduate in 2009, where he had numerous roles within the real estate business. His most recent role was as a director, covering the wider North West market but with a focus on Greater Manchester, Cheshire and Merseyside.
In his new role Dignum will work on attracting new development finance business for HTB and developing client relationships into longer-term partnerships.
Dignum said: “I’m excited to have joined HTB at what is the start of its next phase of growth. HTB has a fantastic development finance product which is continuously evolving and improving.
“The North West is a market which offers so much opportunity for developers and we are well placed to help both existing and new clients deliver on their plans.”
He added: “The demand for high quality, sustainable homes across the North West has never been higher and HTB can play a really key role in supporting the large number of SME housebuilders operating across the region.”
Alex Upton, managing director of development finance at HTB, said: “It’s great to welcome Andrew on board. He will play a key role in our growth strategy; his extensive knowledge of more niche sectors such as PBSA and pre-let commercial will allow us to create new products and solutions for our developers who specialise in these markets.
“Our growth strategy is based around partnering with brokers through education, engagement and feedback in order to create solutions for their developer clients. No one should be in any doubt about our appetite for new development finance business.”
Sirius hires Ashley Elkin as senior associate and secures exclusive development exit proposition
Elkin has more than seven years’ experience in the property sector, including five years in property finance.
His previous roles include a seven-year tenure at LSH Commercial Property Consultants, where he joined as a chartered surveyor and was most recently a broker.
At Sirius, Elkin will have the responsibility of advising developers and investors in the private sector and SMEs, focusing primarily on residential development across London, the South East and the North West.
He will also assist the public sector through consultancy across the UK.
Nicholas Christofi, co-founder at Sirius Property Finance, said: “I’m really delighted to welcome Ashley to Sirius. He has a very impressive track record and his background as a surveyor adds an extra perspective and skillset to the Sirius team.
“We have deliberately built a team of advisers who have extensive property experience from a variety of angles, which gives them a deeper understanding of developer and investor needs in addition to just the finance side of things. Ashley is an excellent example of this in action and it’s great to have him on board.”
Elkin added: “I’m delighted to join the fantastic team at Sirius Property Finance. As I was previously a chartered surveyor, I have a good understanding of the wider property market, analysing developments, local rents, sales prices and yields, which can prove invaluable for clients. It also helps when arguing with valuers.
“I genuinely enjoy providing advice to clients who find themselves in difficult situations, whether they have been let down by a lender, a broker or have fallen into hardship. I also take pleasure in structuring high leverage development finance using a combination of senior, stretch senior, mezzanine and equity finance to push a client’s return on equity to astronomical levels. I can’t wait to get started working with clients at Sirius.”
Exclusive development exit solution
The firm also announced it launched a funding line for property developers by gaining exclusive access to a finance solution.
The product is a development exit to term product at 80 per cent loan to value (LTV). Experienced developers can access senior and mezzanine finance at a blended rate of 9.95 per cent. The product has a two per cent completion fee and loans are available on a nine-month term. When that ends, there is a guaranteed term facility up to 75 per cent LTV, with rates starting from 4.45 per cent.
The term part of the product offers loans between £5m and £30m on newly completed schemes but is not available on permitted development schemes.
Sirius did not disclose which lender would be providing the loan when asked by Specialist Lending Solutions.
Christofi said: “At Sirius, we pride ourselves on championing the SME developer and we are seeing far too many good schemes fail due to slight shortfalls in funds. So, we are proud to be able to offer this as a potential solution solely for Sirius clients. It’s perfect for those developers who have experienced delays and cost overruns, want the flexibility to sell more units, or the security of longer-term finance that is pre-underwritten at the outset.”
Kuflink’s P2P bridging platform surpasses £200m
The lender, which launched its P2P platform in 2016 as the principal funding source for its bridging and development finance, said it took it nearly five years to reach its first £100m in investment in January 2021, but just over another year to pass £200m.
Kuflink is a specialist bridging and development finance lender which works with intermediaries and has funded its loans exclusively via its own P2P platform since 2016.
The lender said none of its investors had lost money on any of the bridging deals made and had received £118m in returned capital and interest.
Narinder Khattoare (pictured), chief executive of Kuflink, said: “Reaching £200m of inward investment on our platform is a great achievement by the whole team. Kuflink is a rarity among bridging lenders in that we have built a successful lending business without institutional investment.
“Since 2016, we have been self-funding thanks to our P2P platform and the private investors who have put their trust in our ability to invest their money into worthwhile bridging and development deals. Our record among bridging introducers and investors alike is now well proven thanks to our knowledge, lending experience and understanding of the property market.”
“I am particularly delighted to be able to say to advisers with customers looking for bridging or development finance that, thanks to the growing investment through our platform, our ability to fund more short term loans has never been better.”
Together lends monthly record high of £300m in May
The finance group, which offers UK personal and commercial mortgages, bridging loans and development finance, increased lending by eight per cent month on month.
The figure for May, which includes commercial and personal lending, compares to the £277m that Together lent in April.
The data also showed that its intermediary sales team scored its highest-ever monthly lending total of £164.4m, which included company-record sales of its unregulated bridging and buy-to-let (BTL) products.
Marc Goldberg, commercial chief executive of Together, said the record resulted from the “fantastically strong” performance of sales channels across the group during the period.
He said the volumes of deals had dramatically increased, with record levels of unregulated bridging and auction finance deals, and the lender’s new digital and retention channels growing, while its back book remained resilient.
He said: “These are excellent results and are testament to the hard work of all our Together colleagues. We’re delighted to have achieved this milestone figure of £300m-a-month with other records set in terms of commercial lending.
“It is the second month in a row that we’ve lent £100m in bridging finance, which stood at £106m in May, which in itself is a fantastic achievement.”
Goldberg added: “We are working hard to build out our established values, but also thinking about our impact on the community, in terms of how we can outreach through our social housing initiative, our charitable foundation and our ESG [environmental, social and governance] strategy.
“We want to create more opportunities in the community by working with schools and local groups, but also with the young people within our own business, creating a springboard for young people’s futures.”
LDS and Assetz Capital launch end-to-end development finance package
The package combines a development loan with LDS’ sales guarantee which is an initiative to purchase any unsold units on a site and release its 10 per cent deposit to developers.
Purchasing unsold units is expected to remove risk from the asset and allow lenders to increase leverage. The deposit, which is released to developers, aims to enable them to spread their equity further and build more homes. The deposit is issued as an unsecured loan with zero coupon, which means no interest is payable until the loan matures.
The package is designed to let developers obtain funding for up to 95 per cent of project costs as well as a guarantee that any unsold homes will be purchased.
Developers of housing or suburban apartment schemes across England and Wales with gross development values (GDV) of between £1.5m and £35m can apply for a funding package of up to 75 per cent of GDV or 95 per cent of project costs.
Rates on Assetz’s development loans start from 7.4 per cent and terms are available up to 36 months.
Ben Jenkinson, regional director of LDS Sales Guarantees, said: “We are excited to launch this alliance today which combines LDS Sales Guarantees and loans to provide a higher geared finance package with a guaranteed exit.
“The product will unlock the delivery of hundreds of new homes across England and Wales and we are pleased to be working with Assetz, a quality lender who shares our passion for supporting SME housebuilders.”
Stuart Law, chief executive of Assetz Capital, added: “Historically SMEs have been essential to meeting our national housebuilding targets, but the sector has declined in recent decades because of significant economic challenges and a lack of financial support from traditional sources of capital, like high street institutions or the public sector.
“Today, we are seeing demand for new homes hitting historic levels, while supply continues to lag a long way behind, driving up prices. It is essential for consumers and our housing market that we revitalise SME housebuilding through innovative finance solutions that provide sufficient working capital and de-risk the development process, giving companies confidence to progress with greater certainty of a return on their investment.”
Ashman receives UK banking license
A start-up founded in 2017 by Ashkin Mittal and Manhad Narula, Ashman is now authorised by the Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) and regulated to trade with restrictions.
The company said it planned to focus at first on small and medium enterprises (SMEs), which it termed a £90bn market opportunity, on deals from £100,000 to £5m in the commercial real estate sector. It planned to provide loans for what it considered to be “conscientious businesses and simple savings for conscious consumers”.
Ashman is led by chief executive James Leach, the former global chief operating officer of Maple Financial. Among his senior team is the chief risk officer, Lisa Nowell, formerly with the digital bank Monzo; the chief commercial officer, Caroline Luxmore, who was with Aldermore Bank for a decade; and Matt Cowan, chief financial officer, who has worked at Deutsche Bank, HSBC and RBS. The chief operating officer is Simon Healy, previously one of the founding members of Aldermore.
“Our banking licence is an important first step in realising our ambitions to support SME borrowers and personal savers alike”, Leach said, “with a different approach to lending that delivers the service and range of products we know SME developers need.”
Crystal strengthens sales team with three hires
Mollie Rising (pictured) is joining the distributor as business development manager for Central London, while Joe Entwistle and Sean Harrigan join as telephone account managers.
Rising previously worked as a mortgage adviser at The Mortgage Library whilst Entwistle and Harrigan join from Coventry Building Society and Future Telecommunications respectively.
Crystal Specialist Finance works with brokers and other financial professionals across the UK and has access to over 100 lenders, including product lines and lenders with limited distribution.
Crystal has over 80 lenders on its panel and specialises in short-term bridging, commercial finance, development finance, second charge loans, complex residential and buy to let (BTL) mortgages.
Jason Berry, group sales and marketing director at Crystal Specialist Finance, said: “Our Thrive survey established that brokers now want a blended contact strategy from their lender and/or distribution partners. Delivering reliable virtual platforms along with effective telephony and regular face to face support are therefore more important than ever.”
“Mollie is a great addition and I am sure her previous experience guarantees that she will connect brilliantly with our key supporters in and around Central London whilst Joe and Sean are super keen to develop themselves personally and also educate the accounts they are set to work with on all things specialist. I am delighted to welcome all three into the Crystal family.”
Cambridge and Counties marks decade of business with £1bn milestone
The total number of staff at the bank hit 200 for the first time since launch in 2012.
Cambridge & Counties Bank (C&C), which also reached the £1bn deposit mark over 2021, said it had achieved the £1bn lending milestone by early 2022.
The lender specialises in commercial lending and was set up in the East Midlands. Its headquarters are in Leicester and it also has offices in Sheffield, Bristol, and London and a network of relationship managers across England, Wales and Scotland.
C&C is running a series of events and initiatives to celebrate its 10th anniversary including a social media-based charity donation initiative, called One Big Birthday Present, which will see 10 charities share £10,000. Customers, finance brokers and other stakeholders have been asked to nominate registered charities as part of the process.
Others initiatives include a competition at the NACFB’s annual conference in June and a series of events aimed at celebrating the bank’s employees, including the introduction of a long-service reward scheme.
The bank saw a 47 per cent rise in gross new lending to an annual record of £323m during 2021. Asset finance lending rose 29 per cent in 2021 while finance for the purchase of classic cars and sports vehicles using hire purchase and lease purchase products increased 33 per cent.
Donald Kerr (pictured), chief executive of Cambridge & Counties Bank, said: “The world was a very different place when the bank was launched 10 years ago. But despite strong market competition and significant macro-economic challenges, we have continued to thrive because we understand the importance of remaining relevant to both our customers and broker partners.
“At the heart of our success are our dedicated employees and our celebrations will reflect the central role they play. And whilst we continue to invest in technology to underpin our service, we will continue to stick to what we know creates value and long-term growth: one-to-one relationships over the entire lifetime of a customer and to remain the bank of choice.”
Investec Real Estate lends record £1.2bn in 2021/22
The lender said the record performance demonstrated ongoing demand from UK real estate borrowers for flexible financing solutions despite unprecedented macro-economic challenges.
The £1.2bn comprised £524m of investment finance and £472m of development finance, with a slight weighting towards commercial real estate.
During the period, Investec reported lending against numerous real estate schemes, in an increasingly diverse mix of use classes, including residential for sale, Build to Rent, purpose built student accommodation (PBSA), office, mixed use and retirement living.
The average loan size during the period was £14m, up from £8m last year.
Highlights from the year include offering Investec’s first modular housing loan and arranging record £170m Build To Rent facility.
There was also over £500m of financing in the private client team, across 60 loans; more than double than in 2020/21.
Most of the new lending was in London and the South East, targeted at residential development finance. This included a £40m repositioning loan on a central London mansion block, £25m for a UK-wide GP surgery portfolio, a £35m residential development loan in St. Albans and a £35m student housing development loan in Bermondsey.
Mark Bladon, head of Investec Real Estate, said: “Originating £1.2bn of committed finance across our three client segments of corporates, private clients and offshore is a phenomenal achievement.
“Considering the backdrop, first with Covid and now the uncertain geo-political situation, as well as the increasing number of market entrants, makes it even more impressive.
“With a deep understanding of operational real estate built up over nearly 30 years, the support of the wider bank, and a global client base, we continue to grow our market share, without compromising on loan terms.
“Whilst we will exercise caution in the face of a higher inflation and interest rate environment, we expect structural undersupply in almost every sub sector and supportive demographic trends to drive increasing demand.”