Momenta Finance provided a development exit facility to support an experienced property developer in refinancing an existing development loan secured against a recently completed residential conversion project in Surrey. The borrower required time and financial flexibility to achieve best-value sales of the newly created apartments, rather than being pressured into a distressed exit under their original development facility.
£3.3m Development Exit Loan on Complex Residential Conversion
The Property
The security comprises a four-storey building originally constructed as a detached office building in the mid-1990s. Following acquisition in 2024, the borrower successfully secured planning permission and completed a full conversion of the building into 20 self-contained one-bedroom apartments.
The development is well-located within commuting distance of Central London, with excellent transport links, motorway access, and proximity to a major university, all of which underpin strong and sustained residential demand in the area.
The Borrower
The borrowing entity is a special purpose vehicle (SPV) established specifically for this development, backed by experienced principals with a strong track record in UK property development. The sponsoring group includes both UK-based and international investors, adding a degree of complexity to navigate in a short period.
The borrowers demonstrated the experience and credibility required for this type of structured facility, and Momenta Finance was satisfied that the combination of the completed asset, robust sponsorship, and clear exit via unit sales provided a sound basis for the loan.
The Challenge
With the conversion works fully complete, the borrower’s existing development finance facility had served its purpose but was approaching maturity. The borrower needed to refinance swiftly onto a product that would give them the breathing room to market and sell the apartments at their own pace, without being constrained by the tighter timelines associated with a construction or development loan. Momenta Finance worked closely with the borrower to design a solution that was clean and commercially effective across both facilities.
The Solution
Momenta Finance provided a £3.3 million development exit bridging facility.
The loan was structured on a 9-month term with interest rolled up at 1% per month (12% fixed), providing the borrower with a clear and manageable cost structure throughout the sales period. An upfront arrangement fee of 1% was applied, with no exit fees or early repayment charges, giving the borrower maximum flexibility to repay as sales completed.
Momenta takes a holistic view of real estate transactions and can leverage development exit loans up to 75% of the open market value.
The Outcome
By refinancing onto a development exit facility with Momenta Finance, the borrower was able to:
• Exit their existing development loan in an orderly and cost-effective manner
• Retain full control over the sales process and marketing timeline
• Access a competitively structured product with no pressure to sell in a distressed timeframe
This case illustrates Momenta Finance’s ability to deliver tailored, structured solutions for experienced developers navigating the post-completion phase of a residential conversion: combining speed, flexibility and institutional funding capability to support a successful and well-managed exit.
Get in touch
For introducers looking to connect with a seasoned professional who understands the nuances of the property industry, Andrew Gagan is the go-to person. Connect with him now here: andrew.gagan@momentafinance.co.uk.
