The property market is starting to look up with the house prices outside London starting to rise and a steady increase in new build homes being sold. However, despite this buoyant market, smaller developers are still having problems accessing finance from the high street. There are a variety of reasons for this but one theory is that banks see smaller developers as too much of a risk.
One developer that came upon this problem was John Burke from development company Corryard, which is based in Crieff in Perthshire, Scotland. Corryard were established in 2006 and made their mark in the industry winning the 2011 Award for the Best Large Renovation in the UK by the Federation of Master Builders for renovating Locherlour Mill. In 2012 John took on the ambitious project of redeveloping Benheath, a Victorian building originally built in 1879 that had been used for a variety of purposes including a children’s nursery and an old folks home. Initially he spoke to his bank as a finance partner, however at that time any kind of property lending was seen as too high risk by the high street banks.
John was confident in his development as he had sold 4 of the 9 units from plan so he looked at alternative routes to finance the projects. In autumn of 2012 he started working with Development Finance Ltd as their finance partner for the Benheath Apartments development in Crieff. John commented “Development Finance Ltd offer so much more than just helping to finance projects, first and foremost they have a dedicated team member that you speak to which means you always deal with the same person, rather than going through to a call centre and dealing with a complete stranger. For me they also made a swift decision on the funding and there was a quick turn around on funds which, meant that I could commence with the build and get our clients into their new homes on time and on budget.”
With only the final two penthouse apartments to sell at Benheath, Corryard have already arranged funding with Development Finance on their next project, Dalmhor House in Crieff, which is another refurbishment project.
David Levitus, Director at Development Finance commented “Corryard is a great example of how Development Finance Ltd can work with builders and developers. We have already put a finance package in place for Corryard’s next development and hope to continue to work with them in the future.