Development Finance Project Delayed by Covid-19
Sourcing funding for a development finance project delayed by Covid-19 reflects one of the toughest challenges developers faced during the pandemic. With lenders scaling back appetite and sites stalled by restrictions, many projects risked failure. Articus Finance was engaged to deliver a practical, lender-approved solution that ensured completion under a revised schedule.
Introduction
The global pandemic impacted every aspect of property finance. Projects midway through construction were put at risk as lenders pulled support or refused to extend terms. This case demonstrates how Articus Finance arranged a bespoke refinancing structure for a development finance project delayed by Covid-19, ensuring the client achieved both financial security and project completion when external disruption threatened progress.
Client Background
The client was a UK residential property developer whose scheme was midway through construction before lockdown measures created unforeseen delays. His original lending partner, concerned about uncertain exit timelines, withdrew further support. As a result, the development needed new capital on revised terms to keep the scheme moving and avoid prolonged disruptions.
- Profile: Experienced residential developer
- Project Type: Mid-scale UK residential housing scheme
- Complication: Original lender declined to further fund after Covid-driven delays
- Objective: Secure fresh development finance to replace withdrawn funding
The Challenge
Covid-19 disrupted both site operations and lender confidence. Developers faced a dual issue: construction was slower, and lenders became more risk-averse. For this client, challenges included:
- Stalled Cash Flow: Original budgets and schedules were compromised by lockdown restrictions.
- Lender Withdrawal: Existing financing partner exited, leaving the project halfway completed without support.
- Market Uncertainty: Valuations and GDV (Gross Development Value) assumptions were called into question during volatile conditions.
- Tight Timeline: Without refinancing within weeks, suppliers, contractors, and project schedule risked full cancellation.
These pressures made the project appear riskier on paper, reducing lender competition and narrowing available choices.
Our Solution
Articus Finance deployed our specialist development lender network. Instead of presenting the case as a distressed project, we reframed it as a viable scheme impacted only by external timelines. Key interventions included:
- Revised Timeline: Provided lenders with updated schedules reflecting realistic post-pandemic delays.
- Updated Valuations: Commissioned independent reassessments to prove the project retained strong GDV despite Covid.
- Cash Flow Models: Delivered revised forecasts to evidence repayment ability on adjusted horizons.
- Specialist Partner: Sourced a development finance lender with appetite for mid-construction rescue funding.
The result was a competitive development loan structured with new drawdown stages and flexible completion dates. This gave the developer the capital inject they needed while ensuring the lender was comfortable with updated risk parameters.
Key Highlights
- Project Type: UK residential development
- Main Issue: Covid-19 delays forced withdrawal of original lender
- Finance Secured: Development finance arranged via specialist lender
- Outcome: Restructured facility allowed works to continue to successful completion
Why Articus Finance Delivered
Delivering this development finance project delayed by Covid-19 required insight, networks, and strong lender packaging. While many brokers were constrained by mainstream institutions, Articus Finance leveraged deep experience with development loans to align the right lender to the revised project profile.
Our differentiators included:
- Access to Niche Lenders: Close ties with lenders still active during periods of reduced liquidity.
- Expert Structuring: Reframed the borrower’s case as viable long-term, not distressed.
- Product Breadth: Ability to pair
Development Finance
with bridging or
Development Exit Finance if required. - Resilient Presentation: Enhanced due diligence and transparency built confidence with underwriters.
Articus Finance continues to demonstrate its role as a trusted partner for clients managing complex builds and transitional project finance.
Explore Related Insights
- Development Finance Options
- Bridging Loans for Developers
- Private Bank Mortgages
- High Net Worth Mortgages
- Interest-Only Mortgages
- Articus Case Studies
- Articus Guides
- Financial Conduct Authority
Final Thoughts
This development finance project delayed by Covid-19 illustrates how developers can overcome sudden disruptions by engaging specialists with lender credibility. By restructuring timelines and sourcing actively lending partners, Articus Finance ensured this scheme reached successful completion when mainstream lending options no longer applied. We continue to help clients secure bespoke financial strategies in volatile markets.