The involvement of LDS leads to a number of benefits opening up. Whilst the below list is not extensive and each developer will have their own reasoning for working with us it should give a good idea of the upsides.
Increased Access to Funding at Reduced Costs
As high street banks, who typically offer the lowest rates, are not interested in speculative residential development funding (aka spec resi) this vacuum has been filled by alternative lenders. The majority of these lenders have sprang up to take advantage of the gap left by the banks and have grown very quickly as a result. The make up of this secondary lending market ranges through challenger banks, bridging finance, private equity, crowdfunding and high net worth individuals in the main. The one thing they all have in common is that they are substantially more expensive than the high street banks, who as mentioned will not issue terms on spec resi.
LDS changes the risk dynamic of sites and therefore the opinion of any lender simply by removing the speculative risk opens up these attractive funding channels. Irrespective of which lender you may choose to approach the involvement of LDS will massively improve their credit risk and allow you access to terms and rates previously unavailable
With a guaranteed exit through the underwriting scheme, you will no longer be scrutinising your work in progress, and capital outlay. You can enjoy cost efficiencies on project and site management as well as your contractors and other resources.
It is a familiar story that units start to sell quickly but post PC there are a handful of units that are slower to sell. All the time these units are unsold they attract increased marketing spend, staffing/admin resource and finance costs to name a few. These costs can become disproportionate to the value of the units over time and eat into margins. Working with LDS will remove these concerns as you can call upon us to complete on unsold units at any time and move onto other. We see an opportunity to partner with you to underwrite your sites to allow you to progress with financing, construction and retail sales.
Move Forward with Confidence
The overriding feedback we have to date is that our underwriting instils confidence in developers. This offers the ability to do larger or multiple sites with less risk than the smaller or single sites previously developed. On top of this it allows developers to focus on the business and not have sleepless nights over the expected success or failure of sites.