A first-time developer with a plot of land in a desirable Dorset village, full planning for three detached houses, and no track record. This is the scenario that most mainstream development lenders decline without a second look — but it is also exactly the type of deal where the right lender, the right structure, and the right presentation can make all the difference.
We arranged a £910,000 facility — £310,000 for the land purchase and £600,000 for construction — in six weeks. Here's how we made a first-time developer's first scheme financeable.
| Detail | |
|---|---|
| Finance type | Development finance — ground-up new build |
| Total facility | £910,000 |
| Site location | Dorset village (greenfield plot) |
| Land purchase price | £310,000 |
| Land loan | £248,000 (80% of purchase) |
| Build facility | £600,000 (£200,000 per house) |
| Developer cash contribution | £140,000 |
| Projected GDV | £1,300,000 |
| LTGDV | 70% |
| Profit on GDV | 22% |
| Planning status | Full planning consent — 3 detached houses |
| Build programme | 12 months |
| Time to completion | 6 weeks |
The developer had a successful career in a different industry and was self-funding the land purchase, but had never built a property. Development lenders are fundamentally risk managers, and a first-time developer is an unknown quantity. Most lenders' credit committees view first-time developers as requiring either a very conservative LTGDV (60% or lower), an experienced co-developer, or a mezzanine layer to absorb additional risk. At the developer's initial approach to lenders directly, three had declined outright.
A Dorset village is not a problem in itself — but it does mean fewer directly comparable new-build sales. Lenders and valuers rely on comparable evidence to validate GDV, and in rural locations that evidence is thinner than in urban areas. The risk is that a valuer applies a conservative haircut to the GDV based on limited comparables, which compresses the LTGDV and can make the deal unviable at the proposed facility size.
The developer's initial cost schedule was prepared by a local builder, but without the level of detail that development lenders expect. A £200,000-per-house build cost is reasonable for a standard specification in Dorset, but lenders want to see a line-by-line breakdown — not a single lump sum. Without a detailed cost report, the lender's monitoring surveyor has nothing to validate the drawdown schedule against, and the credit committee has no confidence that the contingency is adequate.
We addressed all three challenges simultaneously. First, we identified a specialist lender with an appetite for first-time developers on well-structured schemes. Second, we assembled a comparable evidence pack from new-build sales within a 10-mile radius, supplemented by Land Registry data and sales agent commentary. Third, we worked with the developer's builder to produce a detailed line-by-line cost breakdown with a 10% contingency — the level of detail the lender's monitoring surveyor needed.
The lender accepted the first-time developer profile on the basis of four mitigants. First, the developer had appointed an experienced local builder with a track record of similar schemes — the builder's CV was included in the credit submission. Second, the LTGDV was set at 70% rather than the 75% maximum, giving the lender a 30% equity buffer. Third, the developer's cash contribution of £140,000 represented 35% of total project cost — well above the 25% minimum. Fourth, the developer demonstrated personal liquidity of £200,000 beyond the cash contribution, providing reassurance that the project would not stall if costs overrun.
The revised cost schedule broke the £600,000 build facility into detailed categories per house: foundations and groundworks (£35,000), superstructure and roof (£65,000), external walls and windows (£30,000), M&E first and second fix (£25,000), internal fit-out and finishes (£25,000), external works and landscaping (£10,000), and contingency (£10,000). This level of granularity gave the lender confidence that the budget was realistic and that each drawdown stage could be independently validated by the monitoring surveyor.
💡 Key point for first-time developers: The detail in your cost breakdown is the single most important factor in getting a first-time development finance application approved. A lump-sum build cost tells the lender nothing. A line-by-line breakdown with a named builder and a 10% contingency tells the lender you understand what you're doing — even if it's your first scheme.
Worked with the developer's builder to produce a detailed cost breakdown. Assembled comparable new-build sales evidence from Land Registry and local agents. Shortlisted two lenders with first-time developer appetite.
Full credit submission including builder's CV, detailed cost breakdown, comparable pack, developer financial profile, and personal liquidity evidence. DIP issued within 5 working days. Valuation and monitoring surveyor instructed.
RICS valuation completed. GDV confirmed at £1.3 million. Formal offer issued. Legal work completed. Land purchase funded and first build drawdown conditions agreed.
"Three lenders said no before this developer came to us. The deal was fine — the presentation was the problem. Once we had a proper cost breakdown, a comparable pack, and the right lender, it was a straightforward approval. First-time developers don't need a different kind of finance — they need a different kind of submission."
— MW Capital AdvisoryWe specialise in making first-time developers financeable. If you've got a scheme with planning but you're struggling to get lenders to take you seriously, speak to us. We know exactly what the credit committee needs to see.
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