Catalyst has launched a new senior ground-up development finance product, marking its formal entry into the dev finance market.
Its offering targets smaller residential schemes across England and Wales, with loan sizes ranging from £250,000 to £5 million.
The lender’s new offering provides funding of up to 85% loan to cost (net of interest) and 70% loan to gross development value. Variable interest rates start from 6.50% plus Bank of England base rate, with fixed rates available from 10.50% per annum.
Chris Fairfax, chief executive at Catalyst, said: “We understand the challenges developers face in securing the necessary funding to bring their projects to life. Our new senior product is specifically tailored to provide the leverage required to unlock potential and drive growth within the development sector.
“And with variable rates from 6.50% + BBR, and fixed rates from 10.50% per annum, we’re pleased to deliver a competitive offering that helps developers’ cash flow and profit margin.”
The launch comes as the need for housing supply continues to dominate the political and economic agenda. While major housebuilders tend to focus on larger sites, small and medium-sized developers are seen as crucial to delivering infill and urban residential schemes, particularly those suited to first-time buyers.
URBAN FOCUS
Catalyst’s development finance proposition is aimed at experienced developers with projects of between one and 15 units, with a particular focus on urban residential sites in England and Wales.
Anna Bennett, marketing director at Catalyst, added: “If there’s one product brokers ask our BDMs for time and again, it’s development finance; so, we are excited to launch ground up and meet this demand.
“Our current funding appetite lies with experienced developers who have urban residential schemes from 1 to 15 units in England and Wales.
“We believe this funding is crucial in easing the housing shortage and enabling the delivery of smaller projects and first-time buyer-targeted properties.”
Catalyst said the new product is supported by a specialist team with deep experience in property lending and an appreciation for the complexities of the development lifecycle. The firm emphasised its commitment to long-term relationships with brokers and developers, offering a service underpinned by pragmatic underwriting and collaborative decision-making.
