Development finance in Scotland for inexperienced developer



We are frequently approached by clients who have struggled to secure loans elsewhere. I recently assisted a client who had owned a piece of land for several years, but had been unable to arrange the development finance to begin his project. Having spoken with Enness previously, my client in this case contacted our client services department to ask for assistance securing development finance in Scotland.

My client was himself Scottish, and worked in construction management. Although my client had completed a few projects, he was by no stretch an experienced developer. Lenders will generally want to see a solid portfolio of development projects. However, he was local to the area and had good knowledge of it, so this stood in his favour.

He had already purchased the land, which had a current value of £250,000, and had a two-phase development planned. In the first phase, he intended to develop eight flats, each with two bedrooms. With build costs of £350,000 and a gross development value (GDV) of £700,000, this was a well-thought through project which I felt certain I could assist with—but there were several problems.

As the development was located in Scotland, many lenders were not prepared to approach this project—furthermore, the land was not in a desirable area of the country, which is off-putting for lenders looking for certainty that the flats can be sold to repay the loan.

My client also had adverse credit. He had already approached another lender and received terms, but this lender required upfront fees and my client was not prepared to pay these.


Fortunately, I have an excellent relationship with a lender who is happy to lend in Scotland and has good knowledge of the local market. This lender does not charge any upfront fees, and only charges interest on the money which is drawn from the facility.

We secured a first charge over the land, arranging a gross loan of £350,000 at a rate of 1.15% serviced for a period of 12 months. If you are looking for development finance in Scotland—or indeed, across the UK—I would be very happy to discuss your plans with you further, so don’t hesitate to get in touch.