District & County Investments (DCI) has provided a £220,000 net (£252,000 gross) development exit facility to an SME developer in Aldershot, allowing the borrower to extract equity from a completed property and purchase land at auction.
The facility was secured against a finished new-build three-bedroom semi-detached property, which forms part of a two-unit residential scheme. The loan was structured at approximately 45% net loan-to-value, with a 12-month term.
Capital recycling strategy
The developer used the funds to complete an auction land purchase, recycling capital from the completed asset into a new project. The transaction allows the borrower to maintain forward momentum without waiting for a sale or refinance of the finished unit.
Rahul Sharma, business development manager at DCI, said: “This was a great first deal to complete at DCI and a strong example of how development exit funding can be used to support ongoing growth for SME developers. The borrower had delivered a high-quality scheme and was looking to efficiently recycle capital into their next opportunity.”
The borrower’s track record and balance sheet strength were factors in the transaction, according to DCI. Local demand and comparable market evidence supported the asset valuation.
Flexible repayment options
The 12-month term provides flexibility for the borrower to exit through either a sale of the completed unit or a refinance onto a buy-to-let mortgage. This approach contrasts with more rigid repayment structures that can constrain developers’ operational flexibility.
The deal reflects broader trends in specialist finance, where property industry professionals are seeking more adaptable funding solutions amid ongoing market uncertainties. However, developers continue to face challenges including extended local authority search delays that can impact project timelines.
DCI indicated the transaction represents its approach to SME developer lending, focusing on flexible facilities that support capital recycling without imposing restrictive repayment timelines. The lender structured the deal with what it described as downside protection through the low leverage ratio.