by David Khan | Sep 9, 2024 | Advice, Featured
When embarking on a property development project, securing the right financing can be a make-or-break factor. At BLG Development Finance, we’re committed to supporting UK SME property developers through every step of their journey. That’s why we’re proud to offer financing under the Growth Guarantee Scheme (GGS), a British Business Bank and government-backed initiative designed to help businesses invest and grow. If you’re considering applying for the GGS, you may be wondering whether your project is eligible. In this blog, we’ll break down the types of projects that qualify for financing under the Growth Guarantee Scheme via BLG.
What Types of Projects Qualify for the Growth Guarantee Scheme?
The Growth Guarantee Scheme loans that BLG offer is designed to support a wide range of property development projects. Here are the key criteria that your project must meet to be considered eligible:
1. Residential and Commercial Developments
BLG Development Finance specialises in providing loans for both residential and commercial property developments. Whether you’re working on a new housing development, a mixed-use project, or a commercial property, these types of developments typically qualify under the GGS. The scheme is particularly beneficial for developers looking to take on projects that might have previously been out of reach due to funding limitations.
2. UK-Based Projects
To be eligible, your project must be based in the UK. The GGS is designed to support UK businesses, so it’s essential that your development is located within the country. Moreover, your business must generate more than 50% of its income from trading activity within the UK.
3. Projects Undertaken by Viable Businesses
The Growth Guarantee Scheme is aimed at supporting viable businesses that have a strong potential for success. As part of the application process, BLG will assess your business’s viability, ensuring that you have a sound business plan and the capability to complete the project successfully. This includes not being involved in relevant insolvency proceedings.
4. Projects Within Subsidy Limits
Because the GGS is a government-backed scheme, there are limits on the amount of subsidy your business can receive. If your project has benefited from other publicly funded programs, this may impact the total amount you’re eligible to borrow under the GGS. It’s important to provide written confirmation that the GGS facility won’t cause your business to exceed these subsidy limits.
5. Adherence to Sector Exclusions
Certain sectors are excluded from the Growth Guarantee Scheme. For example, banks, insurers, public sector bodies and state-funded schools are not eligible. However, property developers – especially those working on residential and commercial projects – are well within the scope of the scheme.
What Isn’t Eligible for the Growth Guarantee Scheme?
While the Growth Guarantee Scheme offers broad support for property development projects, it’s important to note what isn’t eligible. BLG does not offer cashflow loans under the GGS. The Growth Guarantee Scheme via BLG is strictly for development finance, meaning the funds must be used for specific property development activities.
Additionally, as stated above, certain businesses classified under specific sectors such as banks, insurers and public sector bodies, are not eligible for GGS-backed facilities.
How to Apply for the Growth Guarantee Scheme
If your project aligns with the criteria mentioned above, the next step is to apply for financing under the Growth Guarantee Scheme. At BLG, we pride ourselves on our streamlined application process, which involved guiding you through every step, from initial inquiry to final approval.
To get started, you’ll need to provide certain documents that meet our Lending Criteria. Our team will also conduct standard credit and fraud checks to ensure the legitimacy and viability of your project.
Get in Touch with BLG Development Finance
At BLG, we’re committed to helping UK SME property developers access the funding they need to bring their projects to life. If you’re interested in learning more about how the Growth Guarantee Scheme can support your property development, contact us today. Our team is ready to discuss your specific needs and help you secure the financing that’s right for you.
by David Khan | Aug 7, 2024 | Advice
In today’s property development landscape, integrating green building and sustainable design principles isn’t just an ethical or environmental choice; it’s a smart financial strategy. Green buildings reduce the overall impact of the environment, by incorporating energy efficiency, water conservation and air quality. For property developers, whether focused on residential development or commercial projects, the financial advantages of adopting sustainable practices are becoming more and more compelling and multi-faceted.
Reduced Operating Costs
Green buildings typically have lower operating costs due to their energy-efficient design. These structures often utilise advanced insulation, energy-efficient windows, and high-performance solar panels that significantly reduce energy consumption. According to studies, green buildings can see a reduction in energy use by up to 30-50%, leading to substantial cost savings over the life of the building.
Higher Property Value & Marketability
Properties with sustainable design features often yield higher prices in the market. Buyers and tenants are increasingly aware of the benefits of green buildings, such as lower utility bills, healthier living environments, and reduced environmental impact. This heightened demand translates into higher resale values and rental rates, ensuring a better return on investment for developers.
Increased Financing Opportunities
Financial institutions are progressively recognising the long-term value of green buildings. Property developers can often access more favourable financing terms for sustainable projects. Some lenders offer lower interest rates or additional funding options for developments that meet certain green building standards. Bridging loans and other property development finance options can also be more accessible for projects demonstrating a commitment to sustainability.
Attractive Incentives & Grants
Governments and local authorities frequently provide financial incentives to encourage green building practices. These can include tax rebates, grants, and subsidies aimed at offsetting the initial costs of sustainable materials and technologies. Leveraging these incentives can significantly reduce the upfront investment required for green projects, improving overall financial feasibility.
Enhanced Tenant Retention
Green buildings are often more attractive to tenants, particularly in the commercial sector. Businesses are increasingly looking to occupy spaces that align with their corporate sustainability goals. This can lead to higher tenant retention rates and reduced vacancy periods, ensuring a steady income stream for property owners.
Long-term Resilience & Risk Mitigation
Sustainable buildings are designed to be more resilient to environmental challenges, such as extreme weathers. By incorporating features like improved insulation, natural ventilation, and sustainable water management systems, these buildings are better equipped to handle the impacts of climate change. This resilience translates into lower repair and maintenance costs over time, further enhancing the financial stability of the investment.
Improved Health & Productivity
Incorporating green building elements like natural lighting, improved air quality, and non-toxic building materials can significantly enhance the health and well-being of occupants. For commercial properties, this can lead to increased productivity and reduced absence, making these spaces more desirable to businesses and organisations.
In conclusion, the financial benefits of green building and sustainable design are substantial. For property developers leveraging a range of funding options, from residential development finance to commercial development finance and bridging loans, incorporating sustainability into projects not only supports environmental goals but also enhances financial performance. By reducing operating costs, increasing property value, and unlocking new financing opportunities, sustainable development stands out as a wise and profitable investment strategy.
by David Khan | Jun 26, 2024 | Advice
Incorporating sustainable and green practices into development projects is not only beneficial for the environment but also enhances the long-term value and appeal of the project. As the demand for eco-friendly buildings and sustainable developments increases, adopting these practices can give developers a competitive edge. Here we explore key strategies for integrating sustainability into development projects and highlight the role of development finance providers, like BLG, in supporting these green initiatives.
The Importance Of Sustainable Development
Sustainable development focuses on minimising the environmental impact of construction and ensuring the efficient use of resources. The benefits of incorporating sustainable practices include:
- Environmental Protection: Reducing carbon footprints and conserving natural resources.
- Cost Savings: Lowering energy and water consumption, leading to long-term savings.
- Market Appeal: Increasing the value and marketability of properties as consumers become more environmentally conscious.
- Regulatory Compliance: Meeting or exceeding government regulations and standards for green building.
Strategies For Sustainable Development
Energy Efficiency
- Renewable Energy Sources: Incorporate solar panels, wind turbines, or geothermal systems to harness renewable energy.
- High-Efficiency HVAC Systems: Use heating, ventilation, and air conditioning systems that consume less energy.
- Insulation and Windows: Install high-quality insulation and energy-efficient windows to reduce heating and cooling needs.
Water Conservation
- Low-Flow Fixtures: Install low-flow taps, showerheads, and toilets to reduce water usage.
- Rainwater Harvesting: Implement systems to collect and use rainwater for landscaping and non-potable uses.
- Smart Irrigation Systems: Use irrigation systems that adjust based on weather conditions to prevent overwatering.
Sustainable Materials
- Recycled and Reclaimed Materials: Use recycled or reclaimed materials for construction to reduce waste.
- Locally Sourced Materials: Source materials locally to reduce transportation emissions and support local economies.
- Sustainable Timber: Use certified sustainable timber for construction.
Waste Reduction
- Construction Waste Management: Develop a plan to recycle and reuse construction waste.
- Modular Construction: Utilise modular construction techniques to minimise waste and increase efficiency.
- Deconstruction: Plan for the deconstruction of buildings to facilitate recycling of materials at the end of their life cycle.
Indoor Environmental Quality
- Natural Lighting: Design buildings to maximise natural light and reduce the need for artificial lighting.
- Air Quality: Use low-VOC (volatile organic compound) materials to improve indoor air quality.
- Green Spaces: Incorporate green spaces and vegetation within and around buildings to enhance air quality and provide recreational areas.
Partnering With Development Finance Provider BLG
Incorporating sustainable practices often requires additional upfront investment. Partnering with a development finance provider like BLG can help secure the necessary funding to implement these green initiatives. We offer a wide range of funding options, including residential development finance and commercial development finance and bridging loans property development. Ensuring your development projects not only meet environmental standards but also achieve financial viability. Our expertise in finance helps developers navigate the complexities of funding eco-friendly projects and maximising long-term returns.
Benefits Of Green Financing With BLG
- Flexible Financing Options: Customised financing solutions to meet the specific needs of sustainable projects.
- Expert Guidance: Professional advice and support throughout the development process to ensure the successful implementation of green practices.
- Enhanced Project Value: Financing that adds value to projects by enabling the incorporation of the latest sustainable technologies and practices.
Incorporating sustainable and green practices into development projects is essential for creating environmentally responsible and economically viable buildings. By focusing on energy efficiency, water conservation, sustainable materials, waste reduction, and indoor environmental quality, developers can contribute to a healthier planet while enhancing the appeal and value of their projects. Partnering with a trusted development finance provider like BLG ensures that these initiatives are financially supported and successfully implemented, paving the way for a greener future in the development industry.
by David Khan | May 10, 2024 | Advice
So, you are borrowing money from BLG to develop your project… our involvement will obviously centre around the Monitoring Surveyor’s regular reports and making the payments to fund the site, which we aim to turn around as fast as possible. We also monitor how the marketing is going and follow through on the sales and refinancing process. Part of this involves visits from our team to make sure that we understand what is happening and to keep a good and open dialogue with the development team. We find it really helps to smooth the way as and when problems arise, which let’s face it on a development site, seem to be an occupational hazard!
BLG employs construction specialists as well as traditional finance people, so that we can really support our borrowers as things progress.
Our monitoring ranges from seeing sites from the earliest stage to when the properties are completed or near-complete.
Here are a range of our current projects, giving you a glimpse into their varied aspects. They include a complex conversion of a listed building at the strip out stage, a show flat for a high quality finish on a tight budget, a very high spec and technical seaside project built on a ground up basis and the conversion of a large building to include retail, community space and residential.
The monitoring is never boring and can sometimes afford beautiful landscapes and views. The weather doesn’t always play ball but spring and summer times are upon us, so we will start to enjoy the fresh air all the more!
Cécile Verroest, Risk Director, BLG Development Finance
by David Khan | Jan 10, 2024 | Advice
Embarking on a development project is a multifaceted journey that requires careful planning, strategic thinking, and, perhaps most importantly, the right financing structure. The financial blueprint of your project plays a pivotal role in its success or failure. In this article, we’ll explore key considerations to help you determine the optimal financing structure for your development project.
- Project Scope and Scale: Before delving into financing options, it’s crucial to have a clear understanding of the scope and scale of your development project. Different projects, whether residential or commercial, come with distinct financial requirements. Ensure that the financing structure you choose aligns with the size and complexity of your endeavour.
- Risk Assessment: Assessing risk is an integral part of any development project. Understand the potential risks associated with your project and evaluate your risk tolerance. High-risk projects may require more robust financial backing or alternative financing structures. Striking the right balance between risk and return is essential for the long-term success of your venture.
- Timeline Considerations: Development projects often operate on tight timelines. Consider the duration of your project and whether you need short-term or long-term financing. Bridging loans are a popular option for projects with immediate funding needs and can provide a financial bridge until more stable, long-term financing is However, if you know you will need development funding, it’s best to secure that before entering a bridge loan where the exit is unknown.
- Cost Breakdown: Break down the costs of your development project into distinct phases, such as land acquisition, construction, and marketing. Different financing structures may be better suited to specific phases of your project. Tailoring your financing approach to the unique financial requirements of each stage ensures a smoother financial flow.
- Interest Rates and Terms: Scrutinise the interest rates and terms offered by potential lenders. A financing structure might look appealing at first glance, but the devil is often in the details. Understand the terms of the loan, including interest rates, repayment schedules, and any associated fees. Choose a structure that aligns with your project’s financial capabilities.
- Diversify Funding Sources: Consider diversifying your funding sources to mitigate risk. Relying on a single source of financing can leave your project vulnerable to market fluctuations or changes in the economic landscape. Explore a mix of traditional loans, private financing, and potentially government incentives to create a resilient financial structure.
- Consult Financial Experts: Don’t hesitate to seek advice from financial experts. Engage with financial advisors, accountants, or development finance specialists who can provide insights into the most suitable financing structure for your specific project. Their expertise can help you navigate complexities and make informed decisions.
Choosing the right financing structure for your development project is a critical step in ensuring its success. By carefully considering the project’s scope, assessing risks, and aligning financing with your timeline and cost breakdown, you set the stage for a financially sound venture. Remember, each project is unique, and there is no one-size-fits-all solution. Take the time to explore options, consult with experts, and craft a financing structure that paves the way for your project’s prosperous future.
BLG Your Partner For Tailored Success
In the dynamic arena of development projects, securing the right financing structure is paramount, and BLG Development Finance stands out as a trusted partner offering a versatile range of funding options. From residential development finance, covering land acquisition to construction costs, to specialised solutions for commercial projects and bridging loans addressing time-sensitive needs, BLG’s expertise caters to diverse project demands.
BLG has a 20 years’ track record in the sector lending in both the good time and bad – one key factor in choosing a lender is finding a partner who lends during challenging economic time.
What sets BLG apart is our collaborative, holistic approach working closely with clients to understand project intricacies and deliver personalised financing solutions that seamlessly align with goals and timelines. Choose BLG as your financial collaborator, ensuring a solid foundation for the success of your development project.
