SME developers bring significant strengths to the market. They are agile, closely connected to local communities, and can often deliver projects more efficiently than larger firms.

Unlike volume housebuilders, they cannot rely on large marketing budgets to sell homes, so design and specification become critical.

Their ability to create well-designed, high-quality homes plays a key role in shaping the built environment. However, access to the right funding remains a challenge.

It is not just about availability. Many developers, particularly those managing multiple projects, are forced to arrange funding on a site-by-site basis.

That approach slows them down, increases costs, and limits their ability to scale. At the same time, they are navigating rising construction costs, labour shortages, and complex regulatory requirements, all of which make financial flexibility even more critical.

Revolving credit facilities offer a structured solution by providing developers with access to capital that can be drawn down as needed. This enables them to manage multiple projects while keeping costs under control.

Why revolving credit facilities make sense

A traditional fully funded model is commonplace in the market and provides a high degree of certainty for SME developers.

By combining equity and bank debt, it ensures that all scheme costs are covered, giving developers the confidence that they can complete any site they start.

However, for growing developers looking to take on larger projects, this approach has limitations. They do not want to build tens or hundreds of houses without selling any, nor do they want to pay for funding that would allow them to do so.

A revolving credit facility provides a more flexible and scalable way to finance development. Instead of securing separate loans for each site, developers have an agreed facility that they can access when required, drawing down and repaying funds in line with project timelines.

The ability to act quickly when the right opportunity arises can make all the difference. Rather than waiting for new finance to be arranged, developers can move immediately, securing sites, keeping projects on track, and avoiding unnecessary delays.

A revolving facility also improves cost efficiency. Developers only pay interest on the funds they draw down, rather than the entire facility amount. This helps to manage cash flow effectively, ensuring capital is deployed where it is needed most.

Beyond flexibility and cost efficiency, having a revolving facility in place significantly reduces the administrative burden.

SME developers often do not have the in-house financial resources that larger housebuilders rely on. Instead of repeatedly applying for finance, they can focus on delivery.

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A proven approach

We recently structured a £25m revolving facility for an experienced Sheffield-based developer with bold ambitions in the UK housing market.

The facility is being deployed across multiple sites, including a scheme delivering 184 homes in Doncaster and another providing 63 new homes in Lincolnshire.

For this developer, having access to flexible funding was key. The ability to maintain momentum across different locations, without the delays and complexity of arranging separate finance for each site, has enabled them to focus on delivery.

Without this type of facility, progress would have been slower, with additional costs and administrative hurdles at every stage.

Instead, this structured approach is supporting their growth ambitions while helping to deliver much-needed housing in key areas.

What brokers and developers should consider

While revolving credit facilities offer clear benefits, they will not suit every project. Brokers and developers need to consider several factors when assessing whether this type of facility is the right fit.

The first is lender expertise. Not all lenders offer revolving credit facilities, and even fewer have the experience to structure them effectively.

A lender with deep knowledge of development finance will ensure the facility is aligned with the developer’s project pipeline.

Credit terms also need careful evaluation. Interest rates, repayment structures, and facility limits should match the developer’s financial strategy and business model.

Revolving credit facilities are best suited to developers with multiple projects in progress or a steady pipeline of opportunities. If a developer is only working on a single scheme, a more traditional development loan may be more appropriate.

Risk management is also crucial. As with any form of borrowing, developers need a clear financial strategy to ensure they are using the facility effectively and sustainably.

Brokers: Unlocking the right opportunities

Brokers play a crucial role in helping developers secure the right funding solutions. However, not all lenders offer revolving credit facilities, and many do not have the specialist knowledge or appetite to provide them.

That is why brokers need to work with lenders who understand the realities of development finance.

The right lender does not just provide capital but takes a strategic approach, structuring finance that aligns with a developer’s pipeline and long-term plans.

For developers managing multiple sites, a revolving credit facility provides a real advantage, allowing them to scale up, move faster, and deliver more homes where they are needed.

Brokers who recognise the right opportunity and connect their clients with lenders that have the expertise to structure these facilities will be adding real value, helping developers grow while keeping projects on track.