United Trust Bank (UTB) has agreed to fund Factory Estates’ £5m regeneration of a brownfield site in Cambridge.
Gareth Taylor, director of real estate at Excellion Capital, approached the lender with the proposal and, although the regional housebuilder was a new customer to the bank, UTB was impressed with its track record of developments around Salford and Manchester.
The specialist bank provided Factory Estates with a £3.46m facility at 70% LTGDV through the Housing Accelerator Fund, a £250m partnership launched by Homes England and UTB earlier this year. The first drawdown of funds completed within 23 working days of obtaining credit sanction.
“This project was attractive to Factory Estates as it already had planning in place and the team could get moving on it quickly,” said Gareth. “I therefore wanted to introduce a lender which could meet their need for speed, and I’m happy to say that, from my perspective, UTB delivered on all counts. As well as agreeing a higher geared, 70% LTGDV facility, the whole team at UTB worked quickly to provide a swift drawdown and ensure that when the time came, my client had the money available when they needed it.”
Philip Kirkwood, director of property development at UTB, added: “I’m delighted that we’ve been able to support this Factory Estates development with a higher geared facility through our innovative Housing Accelerator Fund. Factory Estates have established themselves as a successful regional developer and housebuilder creating high quality new homes in areas where there’s an identifiable need, and it’s been a pleasure working with Chris Bowman [director at Factory Estates] to get this facility agreed and drawn in just a few short weeks.”
Factory Estates has already secured three off-plan sales at The Gateway and expects to secure more during the construction phase.
Chris commented: “Philip and the UTB team have delivered everything they promised quickly and efficiently. Being an auction purchase, we were working to tight timescales anyway, and we inevitably came across a few additional challenges with anomalies on the legal side. UTB came in from a standing start and quickly recognised what was required and took a pragmatic view, which enabled us to secure the funding without delay. I’m sure many other lenders would have found them to be much more of an issue; in fact, thanks to UTB and Gareth, the banking has been the quickest and smoothest element of this project so far — and that’s not something I can say very often. The Housing Accelerator Fund has really delivered what it says on the tin.”
The five-year lending alliance between Homes England and UTB aims to improve financial support for the building activities of SME housebuilders and developers and will provide construction loans between £1m and £10m.
In May, the British Business Bank agreed an ENABLE Build guarantee with UTB to boost lending to smaller UK housebuilders.