New joint venture product targeted at experienced residential developers in the UK

22 October 2018

A few months ago, Peritus Corporate Finance launched a new joint venture product targeted at experienced residential developers in the UK.

The joint venture product enables developers to achieve higher levels of funding than are typically available through the debt market and offers developers a meaningful profit share even though they are only contributing around 5% of the total development costs in terms of their equity contribution.  

We are delighted to announce that the first of these joint venture transactions has now been completed. The deal involves the redevelopment of the former Barker Shoe factory in Northampton, which is to be transformed into 54 stylish residential apartments.  The joint venture enabled the developer to fund 95% of the cost of the project and the £5.5m raised will be used to start the redevelopment, which is expected to take around 12 months to complete.

Once completed the development will provide 54 units in this historic Edwardian red brick building, including studios, 1-bed, and 2-bed apartments. The units will benefit from high ceilings and period features with a modern finish. There is also planning consent in place to provide an additional 10 new build units. 

Andrew Goodbody, Head of Debt Advisory & Structured Finance at Peritus commented, ‘This is the first completion for our exclusive JV product where we have additional funds to commit. Offering up to 95% loan to cost with a very competitive profit share, we are looking to work with experienced developers in the UK on residential developments which include new build, conversion or PD schemes.’

The Barker Shoe Factory scheme has a Gross Development Value of £7.5m for the first 54 apartments with the JV partner injecting £163,000 of equity and achieving a near 500% return on this equity, based on the scheme’s initial profit assumptions.

Our new product is exclusively available to experienced residential developers looking to fund new build properties or material conversions with finished unit values between £200,000 and £1 million. The maximum Gross Development Value for the JV product is £8m. We pride ourselves in providing an initial response to all enquiries within 48 hours.

Residential developers should contact Andrew and the team to discuss any funding requirements on 0203 7455 892 or alternatively email andrew@peritus-group.co.uk