It's been a busy time in the property finance world in the past few weeks, but there is a distinct imbalance in the market. Prime commercial and residential property are still selling well and funding is available for investments and for development in these areas. However, the secondary market in both sectors is struggling because of a lack of lenders willing to finance any property project carrying what they perceive to be undue risk. In the case of commercial property this may be because the property is let on short leases or where there are break clauses. For residential, there could be a multitude of reasons ranging from location to property type. Flats/apartments are still not popular even with the most active lenders.
As you will see below, we are finding that RBS Group is shying away from any new property projects presented to them for clients new to the bank and is reluctant to help existing borrowers. However, other banks are beginning to step in, cautiously.
I am also pleased to announce our tie up with one of Europe's largest independent commercial insurance brokers. They have the resources to help you make considerable savings on your property and related insurances.
DEVELOPMENT FUNDING
As you may know, CD Property Finance specialises in arranging residential development finance for its clients. Many of you will have facilities with the RBS Group and may be finding that they are reluctant to lend. RBS have generally been very supportive of developers in the past and we have an excellent relationship with the bank but unfortunately they now have to reduce their substantial property loan book. This means that they are very unlikely to take on new clients. For existing clients the picture is not good either and we are already seeing many enquiries from good borrowers who are being told by the bank that they must either reduce or repay borrowings.
We are here to help you. We have long established relationships with all the key lenders and direct lines into their property finance teams. This enables us to solve clients' funding problems. We do not pretend that development finance is freely available but if your scheme meets certain criteria we can probably help. Remember, housing is favoured and the bank will always want to provide enough finance to cover 100% of construction costs and interest. This often means that little can be advanced to buy the land so please bear this in mind.
If you have a project and it needs financing please do contact us.
GENERAL INSURANCE
Our new partner can arrange insurances for
Property Developers - Contractors' All Risks cover; buildings cover; liability insurance
Property owners and investors - Buildings cover; liability insurance.
Here is one example of a current offer:
Our insurance partner is offering great terms to SMEs that meet standard underwriting criteria and have been in business for 3 years or more and have had no claims for 3 years.
For businesses that meet these criteria, and are eligible for their Retailers & Office Policies they will give you a quote of 5% less than your current insurer’s premium.
We will soon have offers for discounted insurance for property developers and will advise you immediately of them. However, if your renewal is due shortly let us know and we will arrange for a quote.
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