Accelerate Your Property Development
Forward funding revolutionises property development finance, offering developers access to capital and investors early entry into prime assets.
Bridging Finance London excels in structuring forward funding solutions for high-value projects, connecting developers with our vast network of investors and lenders.
Expert finance advice
tailored to you
Quality service
Fast, friendly and professional service.
Lender Choice
Over 250 Banks, Hedge Funds, Family Offices & more.
Experience
Over 15 years of specialist finance broking.
Bespoke Lending
Finance tailored specifically to meet your needs.
What Is Forward Funding?
Forward funding is an innovative arrangement where an investor commits to purchasing a property before its completion.
Unlike traditional development loans, forward funding sees an investor providing capital for both land acquisition and construction costs.
This strategy diverges from conventional property investment, as the investor commits funds at the project’s inception rather than acquiring a finished asset.
It allows for a clear exit, removing all sales market risk by being pre-sold to a single purchaser.
It’s an approach that can yield significant benefits for both developers and investors, surpassing traditional funding methods in several key aspects.
How Forward Funding Works
A typical forward funding arrangement follows these steps:
- Developer secures a site and planning permission
- Investor agrees to purchase the completed development
- Investor acquires the land from the developer
- Investor provides staged payments for construction costs
- Developer manages the construction process
- Investor takes ownership of the finished property
This structure enables developers to undertake projects with lower financial exposure, while investors secure early access to prime assets often unavailable on the open market.
Forward funding is frequently utilised in residential developments, particularly when social housing providers agree to forward fund the affordable units within a mixed-tenure scheme.
In such instances, the social housing provider commits to financing and purchasing the affordable units, while the developer manages the market-rate properties separately.
Benefits of Forward Funding
For Developers
Forward funding substantially lowers financial risk.
By securing an investor upfront, developers can take on larger projects without tying up their own capital. This setup enhances cash flow throughout construction, with the investor providing funds at agreed milestones.
Developers can concentrate on their core strengths: site acquisition and project management.
For Investors
Investors gain early access to prime assets, often at more competitive prices than completed properties.
This approach can boost returns, particularly in high-demand markets.
Investors also have the opportunity to shape the development, ensuring it meets their specific criteria or those of potential tenants.
Let’s Talk!
The Forward Funding Process
Initial Consultation
We begin by thoroughly understanding your project. Whether you’re a developer seeking funding or an investor pursuing opportunities, we take time to grasp your specific needs and objectives.
Tailored Funding Solutions
Our access to over 250 lenders, including private banks and specialist financiers, allows us to craft a forward funding solution perfectly aligned with your project. Our proficiency in high-value transactions ensures we handle even the most intricate deals.
Expert Guidance
Our team provides skilled guidance throughout, from initial negotiations to completion. We help you navigate forward funding complexities, ensuring all parties’ interests are protected.
Why Choose Bridging Finance London?
Our expertise in high-value property transactions makes us ideally positioned to arrange forward funding deals.
We possess a thorough understanding of both development finance and investment strategies, enabling us to structure agreements benefiting all parties.
Our extensive network of lenders and investors allows us to find the perfect match for your project, whether you’re a developer seeking funding or an investor exploring opportunities.
We pride ourselves on our bespoke service.
Each forward funding deal is unique, and we dedicate time to understand the specific needs of all involved parties.
