These loans consist of a senior development facility of £3.7m from a challenger bank and £1.1m in capital from a JV equity partner.

The former is a senior loan at 65% LTGDV, priced at 4.5% plus BBR, the latter was charged at 7% priority return, with a simple profit share in favour of the sponsor.

The equity sponsor, which is not being named, provided 100% of the net LTV, this saw the party fully fund construction and land purchase costs, as well as legal and valuation fees upon completion.

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This transaction is the first in a series of strategic joint ventures between the two parties that will target small housing sites throughout the UK.

Cameron Hayes, director at Arc & Co, led on this project and said: “We are pleased to expand the client’s funding relations and establish the partnership between both businesses.

“For many developers, equity remains constrained, so it’s vital to work with an advisor that has the necessary relationships at all levels of the funding stack to get deals over the line.”