24-Unit New Build Scheme, Canada Water

The Challenge

An established developer secured a 0.4-acre site on Redriff Road in Canada Water, adjacent to the British Land masterplan area. Planning consent was granted for 24 apartments across two blocks, including six affordable units. The scheme required £7.8 million in total costs including land, build, professional fees, and finance costs. The developer had £2.3 million of equity but needed to fund the balance. The primary challenge was the scale — at £5.5 million, the loan required a lender comfortable with a larger facility, and the 24-month build programme meant the lender needed confidence in the developer's ability to manage a complex, phased construction across two separate blocks. Additionally, the exit strategy needed to account for the emerging Canada Water market where comparable evidence was still limited.

Our Solution

We arranged a £5.5 million senior development finance facility at 70% LTC with a mid-market lender experienced in regeneration area schemes. The facility included a land drawdown at completion, followed by phased construction drawdowns tied to programme milestones and QS certifications. We negotiated the facility with interest rolled up for the first 18 months, transitioning to serviced interest for the final 6 months as units were expected to be selling. To strengthen the exit case, we prepared a detailed comparable analysis drawing on recent sales at Quebec Quarter and Marine Wharf, adjusted for the specification advantages of a new-build scheme. We also introduced the developer to two local estate agents who agreed to act as joint selling agents, providing pre-marketing letters of support for the lender's credit committee.

The Outcome

Block A completed at month 16 and Block B at month 21, both within tolerance of the original programme. The rising Canada Water market, buoyed by progress on the British Land masterplan and improved local amenities, supported strong pricing. Private units achieved an average of £520,000 for two-beds and £385,000 for one-beds, with overall GDV reaching £11.2 million against an original appraisal of £10.4 million. Sixteen of the 18 private units sold within 3 months of completion, with the final two selling within 5 months. The developer achieved a net profit of £1.4 million, representing a 61% return on their equity investment.