The £175m of senior capital has been committed by HSBC, and supported by funds managed by AB CarVal and LendInvest.

This partnership is designed to allow LendInvest’s existing institutional development financing to be used in a larger, more flexible vehicle for a greater number of SME developers.

The smaller end of the market will be targeted with development loans typically ranging between £1m and £5m, where traditional lenders often lack appetite.

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“This partnership is an important milestone for our development finance franchise,” said Hugo Davies, chief capital officer and managing director of mortgages at LendInvest (pictured above).

“AB CarVal brings deep expertise and significant firepower; HSBC brings the institutional strength and continuity that has underpinned our success to date.

“Together, this creates a sustainable, long-term funding framework designed specifically for the SME developers who deliver the homes the UK urgently needs.”

This announcement comes shortly after LendInvest’s interim results were published last week, where a 20% growth in lending was reported.