Hodge launched two bridging loans aimed at experienced small business developers and brokers specializing in development finance.
The bank says its Acquisition Bridge offering is a short-term finance product for developments with or without detailed or proposed planning consent, where a change of planning or use permission is required, or for agreed developments that are not due to start for six months.
It said the loan could “help developers acquire land or property quickly, giving the borrower time to improve or perfect their planning consent or change of use”.
Its Acquisition Bridge product is available to experienced residential property developers, including partnerships, limited partnerships and limited liability companies. Loans range from £250,000 to £5 million with loan-to-value ratios dependent on available assets and planning permission with terms ranging from six to 24 months.
The lender adds that this loan can provide longer-term financing for the development of the next phase of the project.
The bank’s second product is Sales Bridge, another short-term financing product available to developers as they near the end of a project, allowing them to release capital from development to enable new development opportunities, return capital to investors early, or release funds while assets are being sold.
The Sales Bridge product is only available to the firm’s existing development finance clients, with loan amounts also ranging from £250,000 to £5m. The maximum LTV is 75% of the gross development cost with a term of up to 12 months.
Hodge, head of development finance at Gareth Davies, says: “We understand that development finance requires flexibility. Sometimes opportunities arise that developers want to use quickly, or situations may arise that the developer didn’t anticipate, so we’ve created these new options to help our clients and brokers bridge those gaps.
“The Acquisition Bridge product will allow developers and brokers to access funds faster than traditional development finance and in situations where planning consent has not yet been obtained, with the option to convert into the Hodge Development Finance Fund over time.
“The Sales Bridge product will help our existing developer customers to access extended lead time and additional leverage after practical completion, if required. Allowing greater flexibility and greater opportunity at a time when capital can be tied up in completed units.”