I spend my life looking at risk…

I spend my life looking at risk… Can we build a development scheme within budget? Will the houses sell? Are we overexposed in that region? Are there any foreseeable issues with the site? ‘What ifs’ upon ‘what ifs’ of being a development funder. At times, this can bring about a fairly negative mindset which can be a bit depressing.
It was good, therefore, to get away for a few days cycling in the Alps this summer with my son. But risk appraisal was never far from my mind; I thought of this whilst tearing down a hill at the better part of 60 kph on two strips of rubber tube, each barely thicker than my thumb!

I am not, and never have been, comparable to Chris Froome!

What I really thought was “there is no way I would condone this level of risk taking in my professional life”. How could I support a rank amateur riding a race quality super-lite carbon bike at speeds close to that of a pro-Tour de France cyclist? Those that know me will attest I am not, and never have been, comparable to Chris Froome!

Some risks need to be taken

However, my point is that we all have to live a little. Some risks need to be taken, not recklessly or without due care, but you can’t live in an over-protected bubble.
And that’s a point professionally as well, we need to build new houses, lots of them, particularly affordable new homes. Not every site or scheme is perfect, most have blemishes and challenges to one degree or another.

Hats off to the risk takers!

So, hats off to the risk takers – those professional house builders who take a risk, stake their money and time to build the new home we desperately need. I know they do it for profit, it’s not pure altruism, but it is time that we championed the risk takers a bit more. We need to support the risk takers and I shall try to do so!
Stuart Parfitt is Managing Director of BLG Development Finance and can occasionally be found tearing down mountains at great speed.

What a fabulous evening. BLG would like to say a BIG thank you to all the property developers, housebuilders, intermediaries, professional partners and our very own staff who attended our Summer VIP Party at Mercedes Benz World in Weybridge.  Once we all fought our way through the traffic to a well-deserved drinks reception, it was great to spend time getting to know some of the property industry’s finest.

And then it all became a little more competitive…

After the bubbles were quaffed and the canapes enjoyed, it was time for Peter Wade and Stuart Parfitt’s welcome address, during which they announced the ‘fun’ element of the evening….  Unlimited access to the Mercedes Benz Driving Experience Simulators.  With a leaderboard running and prizes awarded to the 3 fastest lap drivers, the competition soon heated up with some amazing lap times.

Be part of a winning team…

We were delighted to award our podium winners with the obligatory bottle of champagne at the end of the event.  We’re looking forward to working with our business partners throughout the summer and beyond, funding even more developments and meeting new property developers who we hope will become our VIP partners of the future.

Whilst property fraud and cybercrime are thankfully uncommon, identity fraud is regrettably increasing. In 2015, online identity fraud increased by a massive 86%. With regional figures showing Manchester and London as hotspots. This type of fraud has now topped the list of the worst fraud in the UK today (February 2017)*
The scary thing is people often do not realise that they have been a victim of identity fraud until it is too late. BLG is a responsible lender and will work with you to keep you and your details safe. However, working with us is a two-way street and no matter how good and safe we endeavour to be you also need to be vigilant to stay safe.

Below are a few simple suggestions to help protect yourself:

• Carefully read all correspondence sent to you. Always telephone to check if you have any concerns.
• Regularly monitor your credit report.
• Shred documents: bank statements, utility bills, application forms, card receipts, etc. They can all give away information you would rather keep to yourself. More than three-quarters of all household waste contains at least one or more items that could assist fraudsters in stealing your identity.
• Please take care when sending sensitive information in an email. We suggest attachments by way of pdf (particularly for bank details) or using the old fashioned way and calling us. We will always call you back to confirm.
• Social media such as Facebook, Twitter and LinkedIn are fantastic platforms for networking and staying in touch but do take care with what you share. Fraudsters actively mine for personal data and it is surprising how much we unwittingly share.
• Be alert to “phishing” – this is where fraudsters masquerade as a trustworthy company and email you for sensitive information.
• Regularly check your privacy settings.
• Password protect your devices – the more random the password the better. Of the 20,000 Yahoo passwords recently scooped up by hackers the most popular password was 123456.
• Install anti-virus software and keep it up to date.
• Take extra care on public WIFI.

If you think you have been a victim of identity fraud DO NOT DELAY, report to Action Fraud on 0300 123 2040.

Dyan Letts is BLG’s Credit Operations Director

*source: CIFAS

When things go wrong on sites…

Over the past few years, the BLG team has dealt with all sorts of issues on sites. From the less unusual, such as bats and Japanese knotweed, to the very unusual (hopefully), such as buried bodies and great crested newts. Most developers will have come across some of these problems and whilst some are known before works start, most of the troublesome ones only come to light once development works are well underway: contractors going bust, unregistered utility pipes, archaeological remains, unmarked cesspits under old buildings (complete with very suspect sludge), etc…
These site issues invariably mean frustrating delays and costs which even the best contingency plans and budgets can find difficult to deal with. In our experience, however, the worst enemy of sites when coming across these issues is time – never is the saying that “time is money” more apt than in these situations.
We find that the best approach is to (a) not panic (b) highlight issues as soon as they become apparent, (c) throw in the best experts at the problem as soon as possible (this will save time in the end) and whilst it might not be the cheapest option on day 1, it is often the one that works the most economically in the long run.

Newts, bats, weeds and random bodies…

So, now the newts and bats have found new homes, the weeds have been eradicated, the bodies (thankfully neither too old to interest the archaeologists, nor too fresh to concern the police) have been quietly and respectfully been laid to rest, new contractors appointed and the pipes dealt with. We can move on to the next project with plenty of “do you remember when” stories to add to our store of knowledge.
Cécile Verroest is Credit Risk Director at BLG Development Finance and relatively unflappable in a development crisis.

What the funder is looking for

Surprisingly it’s not the “deal” that makes a funder want to fund a development project. Of course, the deal is important but it’s the client’s ability and rapport with the funder that really makes a lender want to lend. Without a mutual respect and understanding, it won’t work. It’s a “team effort”. Building houses is by no means an easy job. The management of a site and all that goes with it is a highly skilled operation, many things can go wrong.

To quote from the Business Dictionary. “Teamwork means that people will try to cooperate, using their individual skills and providing constructive feedback, despite any personal conflict between individuals”.

The team, of course, extends to the professionals involved; Lawyers, Valuers, Architects and Project Managers should also be working together towards the end goal and that can only be achieved by good communication.  This requires regular meetings and trust me it’s worth it.

An experienced developer client will ensure this and an experienced funder will expect it.

I can’t think of any client or funder who is not keen to move on to the next deal and how much easier it will be surrounded by a great team working together.

Written by John Dalby, Executive Consultant Scotland for BLG Development Finance