Bridging & Commercial Magazine — The Power List 2024

Discover development finance solutions structured to deliver, with a choice of fixed and variable rates.

Committed from day one

At Atelier, we are committed to providing competitive development finance solutions that are structured to deliver, with a choice of fixed and variable rates.

Whether your development is residential, student accommodation or care, we can help. Loans are available from £5m to £40m and are custom-built to match your ambitions.

Work with people as committed to your vision as you are, and discover better property finance, by design at atelierfinance.co.uk

Celebrating the industry’s heroes

Let’s push ahead!

the specialist effect

To help you push ahead in 2024 we’ve made significant changes to our bridging finance offer including:

• Unregulated bridging loans available from 0.75% p.m.

• Minimum bridging loan size reduced to £100,000 for first and second charges

• Lending extended to cover all mainland Scotland with no postcode restrictions

UTBANK.CO.UK

Email: bridging@utbank.co.uk

Telephone: 020 3862 1002

Acknowledgments

Editor-in-chief

Beth Fisher

Deputy editor

Andreea Dulgheru

Creative direction

Beth Fisher

Andreea Dulgheru

Sub editor

Christy Lawrance

Photography

Alexander Chai

Contributors

Marcel Le Gouais

Niamh Smith

Sales and marketing

Beth Fisher beth@medianett.co.uk

Special thanks

Gamze Bastug, FinSpace Group

Matt Wells, M Public Relations

Claire Hone, Rhotic Media

Printing

The Magazine Printing Company

Design and image editing

Jana Rade, impact studios

Bridging & Commercial Magazine is published by Medianett Publishing Ltd

Managing director

Beth Fisher beth@medianett.co.uk 0203 818 0160

Follow us: Twitter @BandCNews | Instagram @BridgingCommercialMagazine

To read about our commitment to the environment and sustainable print publishing, please visit https://bridgingandcommercial.co.uk/page_magazine

To read about our commitment to the environment and sustainable print publishing, please visit https://bridgingandcommercial.co.uk/page_magazine.

As we all know, the specialist finance industry is formed on trust and relationships. This is why we pumped this particular issue with exclusive interviews with the head honchos from businesses that have been in the headlines of late.

First and foremost, we’re excited to announce the 40 individuals who have secured a coveted spot on our 2024 Power List [p42]. After narrowing down hundreds of applications and nominations, the influential figures we chose to highlight demonstrate exceptional prowess, resilience, and vision, which we believe has helped shape the course of the market and left an indelible mark on the business landscape.

In our exclusive interview with Atelier, we explore how the tumultuous year for construction in 2023 became a turning point for the company [p16]. Elsewhere, LDS delves into its strategies for building trust, mitigating market headwinds, and the enduring popularity of fixed costs, in a candid conversation that reveals the core principles driving its achievements [p36].

In terms of what’s new in the market, get an insider’s look into the launch and goals of Inspired Lending, a fresh player in the sector [p66]. The directors share their vision for the year ahead, offering a glimpse into what will set them apart in a competitive market. We also speak with Karis Capital about its role as a newly formed debt advisory firm and its approach to standing out [p12], and how FinSpace Group’s cutting-edge tool is revolutionising the sourcing, appraising, and costing of schemes, making these processes more efficient and streamlined than ever before [p33].

Our exploration of the Biodiversity Net Gain rules sheds light on how they will impact housebuilding and the industry’s approach to sustainability [p25]. We also tackle the critical issue of the construction labour shortage and debate how inclusive hiring will not only address workforce gaps but also foster diversity and equality in the workplace [p73].

To top it off, we invite you to relish the moments captured at our exclusive annual Directors’ Lunch [p80] to find out who graced the occasion with their presence.

Until next time.

Andreea Dulgheru Deputy editor

“Thank you for a great service”

“Exceptional service from a professional, diligent and creative team”

“Great lender to work with”

“Saviour at the Eleventh hour MFS”

“Great all round service.

Thank you MFS”

“MFS - My preferred lender”

“Human thinking approach to overcome all the obstacles”

“Great communication and speedy drawdown”

“Quick and hassle free 2nd charge refinance with competitive pricing”

“Nothing but great service”

“Lending as it should be”

“MFS - amazing company with excellent service!”

“Excellent and Committed Service”

“We avoided the instinct to make knee-jerk reactions” p16

25

33

42

66

73

80

Products

The latest specialist finance options

News

Redefining broking

Exclusive

Targeting the young and old

Zeitgeist

Gains for biodiversity, losses for developers

Feature

Reinventing how projects get appraised / LDS shares its tips for success

Cover Story

Interview

Not all heroes wear capes

The secret’s out!

View A new approach to construction recruitment

Limelight

The directors meet again

products selection of key updates

LendInvestMortgages— ‘HouseFlip’and‘Landlord refurb’bridgingloans

• 85% LTV

• £100,000 minimum loan size

• designed to help landlords and property rentalinvestorsflipandrefurbdwellingsandincrease yields

• theInterestrolledautomaticallytoberepaidat end of the loan

Atom Bank — commercial mortgage range

• fixedratesstartingfrom5.75%

• includesbusinessbankingsecuredloans(BBLS)and RecoveryLoanScheme(RLS)mortgages

• upto75%LTVforloansupto£1m

• maximum 70% LTV for loans over £1m

MSLending—dayratebridgingloan

• residentialfirst-chargeonly

• no minimum term

• maximum term of three months

• noarrangementorexitfees

• £3m maximum loan size

SwanseaBuildingSociety— regulatedbridgingloan

• 7.6% variable rate

• loans between £50,000 and £500,000, with higher amountsavailableupondiscussion

• maximumtermofthreeyears

• £250applicationfee

• No ERCs

• 2%productfee

• maximum 60% LTV, with higher amounts available upondiscussion

TAB—fractionalownership investmentproduct

• allowsclientstopart-ownrealestateassetsandreceive monthlyrentalincome

• minimum £1,000 investment

• expectedoverallprojectreturnof10.12%perannum

• full-cyclemanagementoftheprojecthandledbyTAB

Castle Trust Bank — heavyrefurbishment bridgingproduct

• loan sizes between £200,000 and £5m

• 9-18-month loan term

• 0.95%permonth

• 2.25%arrangementfee

• maximum 80% LTV net and 75% LTGDV

• availableforpropertyconversions

MintPropertyFinance—enhancedbridging andrefurbishmentproductranges

• bridgingloansbetween£75,000and£3m

• refurbishment facilities between £75,000 and £1m

• maximum12-monthtermforbothbridgingandrefurb

• heavyadversecreditconsideredwhereexitissale

• dualrepresentationandtheabilitytouseOMVsonkerbsideresidential propertiespurchasedbyexistingborrowerswithloansupto£500,000

• direct access to mandated underwriters

• loans can be considered outside criteria

In pursuit of excellence

There’s a new real estate debt advisory firm in town, led by none other than industry stalwart Nicholas Christofi. With great ambitions to redefine specialist finance broking and handle everything from start to finish, Nick shares how Karis Capital aims to harness the power of partnerships

WORDS BY ANDREEA DULGHERU

We’re not interested in being the biggest—we want to be the best”

Nicholas Christofi has made a name for himself as one of the top specialist finance debt experts—so, when he announced the launch of Karis Capital at the end of last year, the news quickly made waves across the sector.

For Nick, creating his own real estate debt advisory firm was the next big step in his already prolific career, and a chance to continue doing what he loved with the core people he had worked with for many years. “When I look back at it now, I don’t think I could’ve found a better time [to create Karis Capital]. We launched when the market was a bit flat and market sentiment started to come back. We got a little bit lucky in terms of this: the timing was right,” says Nick.

Together with his expert team—including Craig Hardiman-Scott, Ben Hall, Leoni Alexandrou, and Kimberley Gates, who spearheaded the process of setting up the business’ infrastructure in a very short time—the brand was unveiled at the end of November 2023, with the aim of redefining how developers and investors navigate the complexities of real estate financing.

Karis Capital offers nationwide expert counsel on debt and equity, including development funding, short-term lending, investment finance, commercial mortgages, HNW mortgages and asset finance. Its proposition differs from that of a regular mortgage broker—Nick describes Karis Capital’s service as that of an external finance director, tasked with

handling the business’ financial needs from beginning to end. This includes analysis of the firm—including free financial reviews of people’s property portfolios—and advice on structuring both short- and long-term finance for the sake of the client’s longevity and prosperity. “We're not trying to reinvent the wheel. We’ve always been focused on service and deliverability, rather than simply pricing—for us, it’s very much about the whole business, and our focus is on relationships, on both the lender and the client side,” adds Nick.

The full cradle-to-grave service is possible through the real estate debt finance firm’s extensive partnerships with specialist finance lenders—with whom Karis Capital develops and provides a range of exclusive limited products—as well as third parties, including lawyers, surveyors and valuers. “The main things we look for in the right lender partner are transparency, communication and deliverability—these are the values that we have as a business so, in turn, we have to be working with lenders that share those values,” says Nick.

Insurance: a big deal

In addition to its extensive financial advisory services, Karis Capital has launched an insurance arm, which will provide advisory services on a range of policies, including landlord, BTL, commercial property, liability, professional indemnity and cyber insurance. The reason for offering this goes back to Karis Capital’s aim of delivering a cradle-to-grave proposition. Nick explains that this service brings benefits to both property investors and developers, as

they will be covered for any damages from any eventuality, as well as lenders, as they will in turn be confident that the assets they are lending on have got the right cover, thus lowering risk. “Financial advice and insurance go hand in hand. Everything that we want to do is about creating value within a business and being able to look after everything for the client in that stage of the transaction—and insurance is a huge part of it. There's no point [investing in property] if you haven't got the right level of cover and are not getting the right advice,” explains Nick.

The launch of an insurance advisory arm comes at an opportune time, as Nick tells me he has seen a growing need for insurance in the UK property market, driven partly by lenders and their requirements when doing their due diligence. “The more complex the transaction, the more complex the insurance package that goes with that. It's very important to make sure that we've got a team that can give the right advice on this because the insurance market is an ever-changing landscape, just like the debt market. Everything’s constantly changing, so we need to make sure we've got our finger on the pulse to understand what the requirements are from the lenders and also what the borrowers need.”

Choice: too much of the same?

Having been in specialist finance for more than a decade, Nick has seen numerous changes and weathered plenty of storms. As we talk about how this industry has evolved over the years, he notes that more people

are aware of and interested in specialist finance, particularly retail customers who have previously focused on high-street banks.

With a growing audience and thirst for specialist finance, is there enough choice in the market to quench this? The answer is more complicated than yes or no. While there are plenty of lenders in this space, Nick observes that too many have the same funding lines backing them—many of which hold great control over lending appetite—so are too similar with regard to lending policies and pricing. “When the choice is very similar, is there real value there? I’m not sure there is. We would like to see more finance providers in the market that have discretionary capital and can make a decision [themselves], rather than revert to their funding lines,” he says. This is why a lender’s funding line is one of the key factors that Karis Capital looks at when considering which firms to partner with.

It’s not just advisers who are doing their homework on lenders’ funding lines but also borrowers. Nick notes that more clients, especially experienced property investors, are paying particular attention to how a lender is capitalised to ensure they have strong, good-quality funding lines in the background and are here for the long run—a quality that has become as important to borrowers as cheap pricing when considering which lender to go to. “It’s not just about the lender doing the due diligence on the borrower but also vice versa, and part of the

role we play as advisers is giving the pros and cons of each deal we’re offering. You could have the cheapest loan on the market but, if that lender isn’t well capitalised and doesn’t understand the credit risk, then that’s not the right deal for the client. It’s not simply about the price; it’s about finding the right partner,” he elaborates.

Purpose built for old and young

When it comes to the biggest areas of opportunity for property developers and investors, Nick is confident that PBSA and care home schemes will continue to be thriving asset types in 2024 and beyond. “The care home market is a niche but very strong market. People are living longer and will want to make sure their loved ones have got the best possible care during their later years of life.”

Aside from these, Nick sees great potential for the BTR sector, as he expects more institutions and pension funds to invest in these types of schemes towards the third to fourth quarter of the year. “The BTR market is ever evolving and will really help address the shortage of housing that we’ve got. With interest rates where they are now and yields being squeezed, we’re just waiting for the market to settle a bit more before the institutions come back into BTR.”

Values versus numbers

With Karis Capital officially launched, the team is now gearing up to the next phase: growing the business steadily, becoming as profitable as possible, expanding partnerships—particularly

with housing associations, with whom the team is keen to work—and carving a place for it within the specialist finance market. “It’s all about taking the business to the next level, and we have no doubt that we’ll achieve great things. I don’t need to sit here and talk about numbers; for us, service excellence, being transparent and honest and doing everything with integrity for our borrowers and our lenders—these are the values that we that we live by and we feel that, if you do those things, you'll have a successful business,” says Nick. “Our ultimate aspiration is to become a brand that’s synonymous with excellence. We’re not interested in being the biggest—we want to be the best.”

Nicholas Christofi

Hot deals in cold spots

Despite being a tumultuous year for construction, 2023 brought significant business for Atelier. The lender’s CEO Chris Gardner and chief originations officer Martin Gilsenan discuss how the business weathered the storms

Words by ANDREEA DULGHERU

Last year was tough for the construction industry. Activity continued to drop, hundreds of companies became insolvent, and planning delays continued to plague housebuilders.

“2023 was one of the most challenging years in the market since the global financial crisis,” says Martin. “The combination of rising interest rates in the aftermath of the mini-Budget, continuing cost inflation and market uncertainty, and the consequential hit on residual land values made it a challenging year.”

The specialist lender has seen first-hand how these macroeconomic hurdles have affected developers and housebuilders. Despite this, Atelier has had a productive year: “We originated a good deal flow in a market where originations were markedly down,” states Martin. “We backed good residential schemes that were coming in, but we also broadened the asset types that we can fund, and we wrote some significant business in the PBSA and care home sectors in particular so, overall, it’s been a really good year for Atelier.”

The secret behind the company’s lending success last year was avoiding immediate changes to its proposition in response to macroeconomic developments. “We avoided the instinct to make knee-jerk reactions, knowing from experience that a level-head was required. We knew we had the security of a very significant hedged position, which gave us certainty on interest rates. This gave us the headroom to focus on how we could continue to support and trade through a period of volatility,” explains Chris.

The lender’s response was to focus on the core characteristics and quality of a transaction and be transparent about the firm’s lending appetite, both internally and externally. “By focusing on the fundamentals of the scheme and stripping away a lot of the noise and hysteria that you get in a challenging market, it allowed us to bring cohesion around our decision making that translated well into the market,” adds Martin.

While no two cases are the same, a key element of a good lending proposition is the developer’s experience, something that Atelier pays particular attention to when considering

“We are looking to originate £300m of new loans in the next 12 months and that is going to require us to be prepared and bold”

which schemes to fund. “Most of it centres around the developer—ultimately, it’s our partnership with them that is the key to a successfully delivered scheme and repayment of the loan,” says Martin. “We prefer working with debt advisers and developers that have a track record, display the right behaviours, can handle difficult circumstances, and understand the importance of a cohesive and robust capital stack. Aside from that, the ability to establish trust is important.”

TARGETING THE YOUNG AND OLD

When looking at the opportunities in the market, two sectors in particular have been beating the odds over the past 12 months: care homes and PBSA. In 2023, Atelier saw significant activity in these two areas, and it expects to continue writing loans for these asset types this year. “The idea of PBSA is very appealing, not only to students, but also to parents as people’s expectations and standards of accommodation have gone up. Parents don’t want to see their children in poor quality accommodation, so are prepared to pay a bit more to put their children somewhere which is halfway between a hotel and a home, so that’s an important factor,” elaborates Chris.

The same logic applies to the care homes sector. As the UK’s older population continues to grow and families are increasingly looking for the right home for their elderly relatives, the imbalance between supply and demand makes the care home sector an opportune area for property developers and housebuilders.

However, these markets still come with their own hurdles. “The PBSA market is no panacea—the best schemes require different

disciplines to those of standard residential development. PBSA is far more sensitive to timelines because you have to reach completion to hit that specific academic year, so the build programme and timings are very important. This is why we only ever work with developers who have a track record of delivery,” explains Martin.

Location is also essential for the success of PBSA or care home projects. Martin and Chris note that there are pockets of undersupply across the country and therefore opportunity across many towns and cities, which can offer prospects for developers. “Notably, our recently completed loans in both PBSA and care have been in the regions, and will be delivered and operated by some of the most prevalent names in the PBSA and care sectors and make very positive contributions to the community,” comments Martin.

While finding the right spot for PBSA or care homes will differ from scheme to scheme, Chris notes that “cold” spots are more relevant than hotspots when looking at the best location. “It can be very difficult to build a care home in an area with very high land prices. There are certain areas that have got high land values where you simply can’t get the economics to stack up whereas, in contrast, residential schemes are attracted to places with high land values because residential property values are usually high,” highlights Chris. “Some of the best

care homes will be in locations where you wouldn’t necessarily expect them to be, and a lot of these will be outside the South East. That’s where we see an opportunity to support some of these regional care home operators, because they will be best placed to understand that demand.”

SCARCE EQUITY

With interest rates stabilising for now, and the chancellor planning to introduce premium planning services in England to speed up applications, many are hoping 2024 will bring in some improvements for the construction sector. However, there is one big stumbling block that Martin expects will continue giving developers headaches this year: the lack of equity. “Investor sentiment again [became bearish] largely in the aftermath of the miniBudget and, as we went into 2023, mezzanine largely left the market as well—not completely, but many reinvented themselves as first-charge bridging lenders because their own investors had no appetite to be second-charge in that environment,” he elaborates.

According to Martin, this equity squeeze had a massive impact on the viability of projects last year and could continue to affect developers until investors feel confident enough to return. “There has to be some kind of recalibration in the market before investors come back in, but it’s hard to see that changing until there are first signs of a reduction in interest rates,” says Martin.

Beyond this and the other usual suspects— planning delays, labour shortages, and cost of materials—there is one silent killer that Chris claims is affecting the property sector and first-time buyers in particular: the mortgage market’s lack of support for new builds. With the end of Help to Buy, many first-time buyers find themselves unable to raise the necessary deposit to purchase a new build,

as many high-street banks won’t go above 75-80% LTV for a house or flat.

“[Mainstream lenders] will argue that the day you get the keys for a new build, the property’s value will drop by 5–10%, as it’s no longer new. But if you don’t support the first-time buyer new-build sector, you will create a self-fulfilling prophecy on values anyway on the rest of your portfolio. Also, where's your social responsibility? There are thousands of empty flats and houses out there at the moment that could have first-time buyers in them, but they cannot raise the deposit now that Help to Buy is gone. So, what mortgage lenders need to do is step up and start doing 90-95% LTV lending again on those properties,” argues Chris.

RETURN OF THE VARIABLE RATE

Looking ahead, the pair expect to see a shift in borrowers opting for variable rates, as many are hopeful the Bank of England base rate will not go up for the foreseeable future—in fact, Chris predicts that in 12 months’ time, 90% of the business Atelier will write will be on variable rates. Nevertheless, he confirms the lender will continue to offer both products, giving developers choice of fixed or variable rates.

With regard to business plans, Atelier is set to continue promoting its proposition across the UK through its regional roadshows. “We see 2024 as a year of opportunity for the business to grow,” says Chris. “We [are looking to] originate £300m of new loans in the next 12 months and that is going to require us to be prepared and bold. Our plan is to provide good liquidity to the market for the best opportunities.”

“There has to be some kind of recalibration in the market before investors come back in”

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Confidence Reset

how brokers can be in the best position possible in 2024

Challenges in the property industry—economically damaging inflation and consequent interest rate hikes coupled with uncertain market sentiment—have been well chronicled over the past year. But, as 2023 drew to a close, there were glimmers of positivity to cheer brokers and their client base of developers, owners and investors.

Amid the turbulence, buyer activity finally began to pick up, fuelled in no small part by cautious optimism that base rates might have peaked sufficiently to bring inflation back under control. And if a rate cut is sanctioned by the Bank of England this year, as many economists expect, it will bring a welcome boost in confidence.

MSP Capital’s head of broker relations Arian Manouchehri and associate director of valuation Chris Wright discuss their thoughts on the year ahead.

Be ready for anything

As we enter 2024, Arian urges brokers to work with their professional partners more than ever to stay informed and agile. “This is a time when brokers will need to work with their professional partners to prepare for a range of scenarios likely to affect property prices and transaction volumes. I believe the biggest, most fundamental factor will be mortgage rates.”

“The new year began with a surprise move by some mainstream banks and building societies to cut

rates. That’s a sign of competitive pressure and, hopefully, the start of progressive restoration in confidence, underpinned by expectations of declining interest rates in the medium and long term, something seen in the swaps market in recent times.

“But brokers and their partners and clients need to understand the overall context and make an informed judgement about the extent to which the market will recover from the challenges 2023 presented. An overly rapid bounce back would appear unlikely, but confidence will return.”

Chris, whose experience as a chartered surveyor spans more than a decade, agrees with Arian that confidence will increase through the year.

“Yes, people will always need to buy homes. There remains pent-up demand within the market likely to release when economic certainty returns,” he explains. “Brokers who truly understand the challenges and opportunities in the market will be best placed to help their clients act quickly and decisively when these opportunities arise.”

Knowledge and partnerships are key

The pair agree that keeping abreast of macroeconomic conditions and being alive to both potential risks and upsides will help brokers and all other property professionals add that extra level of value.

Linked to market understanding and scenario preparation is Arian’s second piece of advice: surround yourself with a strong, long-term team.

“You want to foster a community of property professionals with experience of the industry and who have ideally ridden previous storms,” he says. “Whether it’s a valuer, lender, developer, accountant, property agent, construction manager or other professional, picking the best partner who can give you an experienced view at the right time will help set you apart. You will be most successful if you invest in partners with insight and opinions you can trust.

“Knowledge, educated predictions and careful planning can give you a competitive edge, especially at a time when the property industry continues to face many uncertainties. Having a team focused on the long term will help you navigate the inevitable fluctuations of a dynamic property market.”

Arian’s guidance is echoed by Chris. “One of the key factors brokers have to consider is the trend in house prices,” he says. “This was subject to downward pressure throughout 2023

because of inflation, interest rates and the cost-of-living crisis but you have to go deeper than the national averages produced by the ONS or Nationwide to see the full picture.

“Markets are nuanced around regional economic conditions, property types, specific locations and many other factors. These all impact on price points. Property professionals shouldn’t speculate based on a national average—they should base their judgements on robust and comparable market evidence. The more contacts with fellow property experts, the more sources you can turn to and the more informed you will be. Yes, some commentators predict further falls in house prices in 2024 or at least a flat outlook but, with the prospect of stability returning and affordability pressures easing, we can anticipate values and prices starting to rise again in due course.

As a final note, Arian emphasises the work MSP Capital does to strengthen its relationship with its intermediaries and professional partners. “We stand ready to work with brokers to help them and their partners to tease out the opportunities to come. As a team, we champion relationship-led lending. The team are underwriters, valuers, accountants and others with first-hand property experience and knowledge. First and foremost, we are property professionals who lend, rather than financiers who happen to have turned to property.”

L-R: Chris Wright and Arian Manouchehri

What biodiversity net gain rules mean for housebuilders and lenders

Regulations forcing property firms to improve the biodiversity of development sites are expected to fuel costs and planning delays. Nonetheless, some housebuilders support them

Words by MARCEL LE GOUAIS

“The biggest probable delay will be a lack of local planning authority resources”

he imminent biodiversity net gain (BNG) regulations are expected to have a profound impact on housebuilders, local authorities, and development finance providers, piling layers of complexity on both the planning process and broader environmental targets.

At the time of writing, the BNG rules were anticipated to come into force on 12th February and will impose a statutory duty on developers to ensure there is a measurable improvement in the wildlife habitats of development sites over time.

The regulations mandate the delivery of a minimum 10% net gain in biodiversity compared to a site’s pre-development state. Firms will have the option of providing the net gain at a different location when it is not possible to do this on site; whichever option is taken, the gain must be maintained for at least 30 years.

There are signs that councils will differ in how they implement the regulations. Planning authorities in Guildford, Greater Cambridgeshire, Worthing, Maidstone, East Devon, and Lichfield have all proposed or adopted policies that require net gains of up to 20% for some sites.

With new rules, extra planning conditions, and a variable approach from local authorities, property firms and their trade bodies expect exacerbated delays to planning approvals and increased costs, prompting lenders to bolster their due diligence processes for development finance.

Many developers have doubts over how planning authorities will cope with the new requirements and if housebuilding will, in turn, suffer another blow.

How it will work

The BNG regulations, which apply only to England, are taking effect through two laws: the Environment Act 2021 and, primarily, via amendments to the Town and Country Planning Act 1990. In November last year, the government published draft guidance for how the BNG framework will apply to planning applications.

Once parliament approves the regulations, new applications for developments of 10 or more homes will have to demonstrate the 10% (or more) minimum gain.

Once permission is granted and before construction can begin, developers will need to provide a biodiversity gain plan that includes details on how gains, whether on site or elsewhere, will be achieved. However, local planning authorities will generally expect BNG elements to be discussed early in the application process.

Planners will assess and monitor steps taken to mitigate adverse effects on biodiversity at the relevant sites, such as creating habitats in which wildlife can flourish or translocating entire habitats, which could involve moving multiple hectares of grassland. Planning authorities will also examine approaches to enhance biodiversity such as the planting of trees or other plants; the creation of badger setts, bat roosts, or bird boxes; or passages wildlife can use to get under or across roads safely.

Where a BNG is to be established at a different place, there will be a review of firms’ landholdings near the development site to achieve it.

The new rules will affect developments of 10 or more homes but, for those with nine or fewer, they take effect in April this year. For major infrastructure projects of national significance, the rules will apply from November 2025.

Costs and expertise

The complexity and expense of implementing BNG will become evident to developers when they face the prospects of planning delays, further costs, and the technicalities involved in identifying off-site areas for net gains.

The trade bodies representing developers have warned that BNG could worsen existing planning bottlenecks. One source says that planning applicants will likely have to factor an extra three to six months into their development programmes.

According to government guidance to councils, planning authorities will need to recruit staff with ecological expertise and train teams to apply the regulations. Some developers believe that as many planning teams are already overstretched, the BNG will worsen staffing issues and lengthen delays to planning approvals.

Steve Turner, executive director at the Home Builders Federation (HBF), says: “The biggest probable delay will be a lack of local planning authority resources, such as planners, ecologists, and lawyers. A lack of capacity in local planning authorities is already the biggest constraint on development and it is taking far too long to process applications. This will be yet another work stream for them to deal with.”

Housebuilders already face a growing burden of regulation on new construction, such as that on energy performance, sustainability, and the materials that can be used. This often makes viability an issue that BNG could intensify.

“With off-site credits being swallowed up by bigger builders, many SMEs will be required to use the national scheme which can be twice as expensive as local markets”

“We secured planning consent back in 2021 so, while the 10% BNG rules do not apply to this development, we have chosen to comply with them because we feel it’s the right thing to do”

The degree to which costs will rise is uncertain, though it’s widely agreed that they’ll increase.

Joseph Dean, managing associate at law firm Womble Bond Dickinson and an author of BNG briefings, believes there will be an immediate and direct impact on costs, because an agreement between a developer and planning authority as to how the BNG is to be delivered will have to be documented.

He adds: “The actual cost will vary depending on the way that these agreements are ultimately going to be documented (by way of section 106 agreements or conservation covenants).” The process of getting to an agreement and putting together the documents can therefore vary depending on the nature of the application. “At the moment, the preference appears to be via section 106 agreements. There will also be legal costs, ecologist costs, planning adviser fees, and local planning authority fees for developers.”

Rico Wojtulewicz, head of housing and planning policy at the National Federation of Builders (NFB), comments that developers’ planning costs have already risen because of the BNG, with ecologists costing up to £5,000 on smaller sites and tens of thousands of pounds on larger ones. He also describes how BNG expenses have affected two (unnamed) members. “Comparing two members’ sites shows one is being asked to pay £800 per home for 1% BNG, because they have their own BNG land bank alongside their large site. The other, a smaller builder, is paying £2,150 per home to use a local [site] provider for their development of 20 homes. Scaling this up to 10% or higher creates an eye-watering cost.”

Lawrence Turner, director at planning consultancy Boyer, anticipates another issue: when development sites have high biodiversity at the starting point, it makes it more difficult to deliver 10% net gain on top.

When, as is often the case, biodiversity mitigation measures can’t be delivered on site, this can cause problems if the planning authority is not up to scratch with the rules.

Turner adds: “We have seen instances in which there is a time cost—for example, at the planning committee stage—when councillors aren’t up to speed on the requirements and expect all biodiversity net gain to be provided on site. This then leads to lengthy dialogue and delays to the planning application.”

The HBF agrees that the impact of BNG on planning will vary depending on the expertise within local authorities, as well as the location, policy context, local house prices, and viability.

One of the more taxing elements for developers will involve the technical aspect of calculating a 10% BNG.

Where on-site gains are not possible, off-site gains will have to be explored, or

biodiversity credits from local landowners or a government scheme will need to be purchased. Buying from the government, however, is expensive.

Rico explains: “With off-site credits being swallowed up by bigger builders, many SMEs will be required to use the national scheme which can be twice as expensive as local markets. Off-site credits should be purchased from local landowners and, unfortunately, this market is not well established and is causing some friction with regard to loss of farming land.”

Early adopters

Damien Wynne, co-founder of sustainable housebuilder Q New Homes, is nevertheless adamant that the principle of the BNG legislation is sound. “Building comfortable homes for people and enhancing the surrounding habitat for wildlife need not be mutually exclusive. Considerate developers can and should achieve both. At Q New Homes, we are voluntarily incorporating measures to boost biodiversity on a scheme of nine homes we’re building in Kent. We secured planning consent back in 2021 so, while the 10% BNG rules do not apply to this development, we have chosen to comply with them because we feel it’s the right thing to do.”

There are several indications that the largest developers, such as Barratt and Bellway, as well as SME property firms such as Q New Homes, have started BNG adoption early and recognise its broader societal benefits.

Helen Nyul, group head of biodiversity at Barratt, states: “Back in January 2023, we voluntarily took steps to introduce BNG ahead of the new legislation. We made a commitment to design in a measurable 10% minimum BNG across all new designs submitted for planning. By September 2023,

the first sites [were] designed in net gains of 36% for area habitats, 76% for hedgerow habitats, and 13% for river habitats.”

Naturally, the lengthy list of BNG elements likely to fuel planning delays leads to another question about its impact: Will housebuilding levels suffer yet another blow?

For housebuilders, issues around targets and planning will vary depending on a firm’s size and where they operate.

Large firms with a presence in multiple regions will have to navigate the differences between them—particularly the 20% BNG minimums—while smaller firms may face an even tougher trading landscape.

Rico warns: “SME builders will be hit the hardest because, despite it being an on-site policy, in practice, it is an off-site tax and this may impact some of their site viabilities.”

“SME builders will be hit the hardest”

“Lenders will need to know whether the BNG provision is on or off site or whether the developer is relying on the government scheme, as it could impact materially on the cost of the development”

With larger housebuilders owning more land from which to choose off-site BNG, sources say they expect SME developers to be more affected due to the narrower choice of off-sites available to them and the extra costs involved.

Some developers believe it should not hinder the broader housebuilding numbers, but will inevitably delay development in the interim as firms adjust to a new system.

There are also fears BNG will use up land that previously would have been committed for housing, prolonging the search for viable sites.

Generally, a period of bedding in can be expected, given the scope of what developers and local authorities need to implement.

Joseph adds: “It will likely be how local planning authorities deal with this that could slow the whole development process down. They will need time to hone the drafting of these agreements. In time, complying with these requirements will be factored in by

developers to their work programme.”

How local authorities enact their BNG policies will vary depending on local needs, but some councils have published strategies that indicate how they will assess applications. Maidstone Borough Council, for example— which is mooting a 20% minimum gain for some areas—is putting the emphasis on new developments with semi-open spaces, as well as increases in tree coverage and wetland projects.

Manchester City Council has published details on the information it will request on how habitats will be managed, as well as on the surveys that should be conducted at the sites. The authority states in its guidance that developers may have to fund the creation and/ or enhancement of habitats to deliver BNG.

Implications for lenders

Many lenders approached for this article declined to comment on how their due diligence processes would evolve to factor in BNG, a reflection of how credit risk policies are normally not shared, but also that development finance providers could be in the early stages of implementation.

Joseph explains that lenders will have to change due diligence processes as a developer’s compliance failure could render the works unlawful, and mean the borrower has breached its obligations under the relevant facility/security documents on day one.

He comments: “Lenders will need to know whether the BNG provision is on or off site or whether the developer is relying on the government scheme, as it could impact materially on the cost of the development, as well as potentially on the lender's options to enforce their security and the structure of the security they are taking.”

Help at hand

Following other environmental obligations for the industry, the BNG regulations pile more technical demands on top of those emerging for net-zero emissions targets. Like other central government green initiatives, the BNG guidelines are imperfect and often vague but, regardless, developers will have to find methods to achieve them. These methods will be refined as the industry adoption gathers pace and, as the trade bodies hope, the government acknowledges several imperfections and fixes them.

“It will likely be how local planning authorities deal with this that could slow the whole development process down”

Sourcing, appraising, and costing up schemes just got easier

Specialist fintech brokerage FinSpace Group has created a new tool to identify sites and appraise and assess scheme viability, while providing all the costs. With this portal now available to all, the firm’s co-founder and CTO Jaffer Abbas takes me on a backstage tour of Propflex and highlights how it will support the industry

Words by ANDREEA DULGHERU

“We’re very customerfocused and looking at doing things differently to shorten the sales cycle”

Tech portals have become commonplace; many specialist lenders have brought out such digital interfaces for brokers and customers to streamline processes. So, when news of another tech platform reached me, I wasn’t surprised—until I learned that a master broker, not a lender, was behind it.

In April 2023, FinSpace soft launched its proprietary Propflex platform to enhance and speed up the lending cycle and alleviate stakeholder pain points. The free tech tool enables property developers and investors to appraise their projects and get finance quotes for them before making any financial commitments.

FinSpace co-founder and chief technology officer Jaffer Abbas tells me the idea for the platform was born two years ago to help FinSpace’s consultants focus less on menial, repetitive tasks so that they can prioritise deal structuring. “When we started looking at the industry, we saw that there was a lot of room to make the [lending process] more efficient,” he recalls. The first step the team took was creating its internal management platform, Caseflex, with the first iteration launched in April 2021. The internal tool was designed to enable its consultants to manage and move forward deals more efficiently, covering document management and case progression. On top of this, the internal platform allows FinSpace to collect and analyse meaningful data on the deals completed through the digital platform to assess how the process can be improved further. “On Caseflex, we can go back six months to look at how long cases have stayed in certain stages, find the bottlenecks, and fix them,” says Jaffer.

With the internal foundation established after many months of testing and updates, FinSpace switched its focus to the second stage of the tech strategy—the client interface, Propflex.

The details

The tech tool—available free to property investors, developers, and stakeholders—offers several features including project appraisals, a quotes calculator for funding, and sourcing via auctions. Its main aim is to test and verify the viability of a project and secure funding in a faster and more streamlined way.

After setting up an account on Propflex, clients have full access to its features. The first step would be for the client to create a project on the system by adding a summary of the specific property investment or development they are keen to undertake.

Particularly useful for developers or property investors tasked with heavy refurbishment projects or ground-up developments is the appraisal tool, which allows them to create a quick or full appraisal of their

schemes, depending on the level of detail the client has for a project at the time. Once a customer inputs the details about their development’s GDV, site, build, and other costs and financials, they are offered a full financial breakdown of the project, allowing them to see the expenses and profitability of the scheme. “We’ve done quite a few changes to this already, mainly to the user interface. We’ve also made it possible to download the appraisal as an Excel worksheet, if clients are more comfortable with this,” comments Jaffer.

For clients who have not yet secured their land or property, Propflex offers the ability to search for viable sites available for purchase through its auction feature. The platform’s auction listings include an extensive range of properties and land on offer, collated from most of the large auction houses in the UK, including Savills, Barnard Marcus, Knight Frank, SDL Property Auctions, and more. “It’s essentially like Rightmove: you can select the preferred auction house, location, and range (if you want it within a specific number of miles), the stages the auction is at, the property type, tenancies, and tenure. So, for example, if you were looking at land and found something you think looks good for a development, you can then get a quote for an existing project you saved or create one,” explains Jaffer. Chosen auction listings will then show up in the My Auctions section. The platform allows users to search across the major auctions, focussing just on the project rather than auction houses.

Propflex also offers calculators that allow property investors and developers to find figures for a range of options, including potential lending criteria they can secure for a first- and second-charge bridging loan or development loan, as well as stamp duty land tax costs and the return on capital deployed. A handy ‘compound interest calculator’ can help in working out complex interest calculations on term sheets.

Once the client has got the full picture of the project they’re looking to undertake, they can get a quote through the platform, check their eligibility for a loan, assess how much they can borrow, receive indicative terms, and view an estimated drawdown schedule for their scheme, should their loan be approved. “Our team of analysts have come up with some advanced mathematical models through which we can calculate variations covering the majority of the market. This is designed to give customers quotes based on the latest information available at the time of request,” elaborates Jaffer.

If the customer is happy with the terms, they can then proceed with a full application, which is handled by the FinSpace team through their

internal system. Clients can view the progress of their application on the Propflex platform, which will show the deal updates done by the FinSpace team on the internal Caseflex tool, and they will be notified via the platform and by email when they need to upload documents directly onto the system—a feature that was fine-tuned at the end of 2023. “The next step is getting lenders involved directly so they can start updating their deals on the platform and take control of that,” adds Jaffer.

Convenience and intelligence

More than 20,000 quotes have been registered on Propflex since its launch, and FinSpace is now looking at more than doubling this figure this year, as the firm will transition to handling all quotes and deals through the platform alone, as opposed to the old forms available on its main website.

In addition, there are several improvements that the brokerage is preparing to implement this year. For example, the team has already started work on a mobile app version of Propflex to ensure it can provide customers with timely communications to make the process of getting their projects funded much easier while promoting more transparency with the borrowers—this is anticipated to be unveiled in the second half of 2024.

Another key feature the team is looking to add to Propflex is a research tool that will provide a range of information and reports on the market—such as average house values in a particular area and amenities near a property— to help property investors and developers inform their projects. These tools will inevitably enable better deal assessment and stronger exits, providing more confidence to all stakeholders.

Additionally, FinSpace is keen to improve several existing characteristics on the platform to streamline processes even further, including the auction tool, which the team hopes to allow direct bids via the platform. Jaffer and his colleagues are keen to add alerts to the auction feature, too, so users can be notified immediately of any lots or properties that will become available in a particular criteria.

There is a long and ambitious roadmap planned for Propflex for this year and beyond, and Jaffer and the team are excited to bring their vision to life, confident that customers will respond positively. “As we keep thinking about how to improve the platform, we chop and change the plan every few weeks,” divulges Jaffer. “We’re very customer focused and looking at doing things differently to shorten the sales cycle, so we’re very excited to bring this to market.”

Certainty at a time of turbulence

2023 was a busy year for LDS—a new managing director, a record number of Sales Guarantees registered, the launch of a free virtual sales director service to help housebuilders, and partnerships with Atelier, West One, UTB, and Pivot, among others. Origination director Alex Maltby and relationship director Richard Cannings share the secrets behind the company’s success and talk trust, mitigating market headwinds, and the enduring popularity of fixed costs

Words by ANDREEA DULGHERU

In your opinion, what are the main factors that have contributed to the success of LDS Sales Guarantees?

Alex Maltby: Innovation, clarity and relationships. The property development sector has seen a wealth of new and recurring headwinds since the 2008 global financial crisis—it is heavily affected by economic and geopolitical events, which can impact on everything from labour and construction costs to consented land supply and ultimate demand and values of newly built homes. The Sales Guarantee is an innovative product designed to mitigate these risks for the benefit of both developers and senior lenders, and our relationships have been key in getting these benefits known to the market.

How many lender collaborations do you have and how successful have they been for LDS?

Richard Cannings: We have numerous relationships with senior lenders, which include six preferred partners such as Atelier. Having multiple preferred partners allows us to transact across this range with speed and efficiency as the intercreditor is already agreed. These lender partnerships generate quality business on a daily basis, and we have many more due online this year.

What are the most important factors you look at when considering which lenders and brokers to partner with?

AM: Our mindset is to work with experienced, quality-driven brokers and lenders for whom supporting SMEs is their top priority, so any firm that is aligned in this way will make an excellent partner for us. Our team spends time nurturing these relationships so that the Sales Guarantee is a natural extension of the broker/lender’s structuring of the deal.

In your opinion, what are the key factors to guarantee a successful collaboration between all parties involved in a deal?

RC: There needs to be a concerted focus from all parties, especially the professional teams, for a successful transaction. Trust is at the heart of all of these as each side places it in the other to perform. Our wider group is in its 24th year of business and has a hard-won reputation for being reliable and straightforward to work with.

2023 has been a fairly turbulent year for construction, with some firms going into administration. How has this influenced the demand for the LDS Sales Guarantees and the types of developers and projects applying for them?

RC: It’s definitely highlighted the benefits of fixing costs at the outset where possible for developers and senior lenders alike. High-profile cases have reminded us that scale isn’t a guarantee of success, and this has driven an increase in enquiries from larger developers undertaking more complex projects – which in part drove us to scale up last year, increasing our maximum GDV from £30m to £55m.

What trends do you expect to see in the construction sector, and which parts of it do you expect to perform the best in the next 12 months and why?

AM: On the demand side, multi- and single-family rental markets are experiencing a boom and I expect this to continue for the next 12 months as larger housebuilders look to ‘right size’ their books of completed housing stock. This provides an interesting exit route for developers but, whether pricing will compare favourably to open market sale in the medium to long term, we’ll have to see.

RC: In the build-to-sell market, the predicted future interest rate cuts and mortgage costs reducing are welcome—it will be interesting to see what promises come out of the general election with respect to first-time buyers. However, the supply chain still has some fragility, despite cost inflation having stabilised, with contractor insolvencies continuing to be high. We would predict there is more of this to come.

What are the biggest issues you think developers will face in 2024, and what advice do you have for them?

AM: Combined with supply chain weaknesses and the continuing challenges around planning and land supply, it’s not hard to predict that overall housing supply is going to remain constrained. Delays in bringing forward sites and uncertainty over delivery place ever greater pressures on developers’ capital reserves. While volume builders are more able to deal with working capital pressures, there is a bigger problem for SME developers—especially those that are trying to grow. Fortunately, this is where LDS can help.

What plans does LDS have for 2024 and beyond?

AM: While dealflow can make it hard to horizon scan, we ensure we set time each week to review future plans. It’s our view that we only need to partner with eight to 10 lenders to cover the spectrum of requirements for our developers. We are on target for this and each new partnership unlocks more opportunities for LDS and the lender. The Sales Guarantee is enjoying rapid adoption, but that doesn’t mean we will rest on our laurels. We are working on a wide range of product enhancements and new offerings. They all have one thing in common in that they will improve the success of lenders, brokers, and housebuilders nationwide, resulting in more new homes guaranteed.

RC: We are alert to the shadow side of rapid growth, so are constantly improving the efficiency of our systems and processes. This enhances the experience for our clients and increases our capacity to process more transactions. The team is growing steadily and we will be adding to it as the year progresses—we definitely need more relationship directors to handle the volume coming through. This is especially true as we see LDS clients move onto their second and third sites with us. We tend to become part of the developer’s finance structure—we are often named in the capital stack with the senior as “tbc”—and our close working relationships mean clients keep us updated on their pipelines and ambitions, which is exciting and challenging in equal measure!

Celebrating the industry’s heroes

POWER

Here we go again, with our fifth annual Power List. This year, we are paying homage to 40 industry heroes—the specialist finance experts who have made a significant change to a business or the industry as a whole in 2023—that have fundamentally improved how a firm and/or the market operates.

Once more, we were overwhelmed by the number of nominations and the quality of the submissions. Going through each and every one was an absolute pleasure and narrowing the entries down from hundreds to just 40 was extremely difficult. Nevertheless, the final list represents the visionaries who understand the market and its complexities (particularly during the turbulence of 2023), were not afraid to take on a challenge, saw the solutions to the problems, and dedicated their hearts and souls to raising the bar.

These experts have shown their passion for their work and their commitment to making the industry a better place—and we hope this will inspire market players in the year ahead.

LIST

Jonathan Samuels

CEO at Octane Capital

Last year was one of rejuvenation for Octane Capital, none of which would have been possible without its trusted chief, Jonathan. Under his leadership, the specialist finance lender has obtained new funding and lent more bridging finance in 2023 than in any of its previous six years of operation. Not only that, but Jonathan helped to drive education in the specialist finance industry through extensive research carried out by Octane Capital as well as through his regular commentary in the industry press.

Kate Cowan

Chief financial officer at Hope Capital

Last year, Kate’s objective was to look at how Hope Capital could streamline processes to make the business more efficient. Throughout the year, she focused on launching a brand-new CRM system and introducing a broker portal and app that would both support the team and improve operations. She also worked closely with other members of the team to improve staff retention in 2023. Kate focused heavily on not only bringing in all levels of the team into championing new developments, but also on increasing morale, teamwork, and motivation. This was achieved through various methods, including launching a social committee and paying attention to mental health at work. Kate, along with eight others from Hope Capital’s people managers’ team, qualified as mental health first aiders early in 2023, which has been described as a massive support to the team. Overall, these actions have been greatly welcomed by everyone at Hope Capital, with a recent survey showing that 100% of the team would recommend the lender as an employer.

Jaffer Abbas

Co-founder and chief technology officer of FinSpace Group

Two years ago, Jaffer had a goal to enhance the specialist mortgage application process for property investors and developers alike—a vision he turned into reality in 2023 with the launch of Propflex, FinSpace Group’s proprietary tech platform. This enables clients to source auction properties and land, assess a project’s viability though an in-built investment calculator and appraisal tool, and secure specialist finance through its online loan application management. This platform has helped FinSpace Group’s team of brokers to place deals for clients in an easier and more time-efficient way, and opened up a new avenue for property investors and developers to better build and assess their projects. In addition, FinSpace Group has seen a 56% increase in the volume of submitted applications thanks to the Propflex tool.

Claire O’Brien

Head of underwriting at Alternative Bridging Corporation

During her time at Alternative Bridging Corporation, Claire has made herself known as a dedicated individual, skilled at finding the right solution for clients and brokers. Having identified an opportunity to improve the lending experience for brokers as well as enable the firm’s team to develop even further, Claire took it upon herself to restructure the underwriting team and create a new underwriting assistant role. This entry-level position not only opened up a spot for a person to enter the bridging industry and gain a foundation in underwriting—thus encouraging new blood into the sector—but provided additional support to Alternative Bridging Corporation’s existing underwriters, which in turn helped them assess cases more efficiently, particularly complex deals.

Uliana Kuzmis

Deputy managing director of the development finance division at Hampshire Trust Bank

Uliana has been instrumental in transforming HTB’s development finance division through numerous strategies, improving operational efficiency, and fostering a culture of inclusivity and personal development. Her leadership has not only streamlined internal processes but also significantly enhanced the customer experience and industry standards. She revamped the credit approval process, improved handover processes between teams, developed a green finance product, conducted internal and external training sessions, and empowered women in finance, among other initiatives. The results? More efficient credit processing, improved team morale and performance, and higher customer satisfaction evidenced by feedback metrics. One colleague commented: “In my eyes, Uliana is a fantastic leader and inspires myself, as well as many others in our company and the industry, to strive to be better.”

Sam Norris

Managing director at Grand Union Finance

Many industry finance experts have played their part in improving knowledge and education in the specialist finance market by sharing their own experiences through thought-leadership pieces and industry events—Sam, however, chose to do this in a new and quirky way. In addition to filming numerous YouTube and social media videos that offer updates on the mortgage market, he also launched a dedicated weekly Q&A platform, ‘Monday Mortgage Melt’ , which aims to provide clarity and insights into the industry for property investors at all levels. Sam has also continued to work on ‘The Game of Loans’ podcast, for which he conducts interviews with property experts on a variety of finance topics. Through these initiatives, Sam has taught many clients how to become successful property investors, kept those working in this sector informed of many market developments and, overall, improved people’s understanding of the specialist mortgage sector.

Vic Jannels

CEO at the Association of Short Term Lenders

Driven by his desire to raise standards in the specialist finance market, Vic was instrumental in bringing forth the industry’s first specialist broker qualification, the Certified Practitioner in Specialist Property Finance. Vic used his 50-year experience in the market and extensive relationships with other experts to bring forward a comprehensive curriculum and exam to improve advisers’ knowledge of specialist finance to help them work more effectively with brokers, lenders, solicitors, and valuers. This initiative has raised educational standards within the specialist property finance industry, with almost 50 candidates having already received their certification.

Samantha Williamson

Senior relationship manager at Roma Finance

During her time as a senior underwriter at Roma Finance, Samantha identified the increasing demand for complex and structured loans, particularly in the ground-up development space, which require close collaboration between borrower and lender to mitigate risks and structure the deals. Determined to improve the lender’s relationship-led approach to ensure these complex deals were handled in the best way, Samantha took it upon herself to create a role as senior relationship manager to facilitate these critical partnerships. This solution has led to a boost in Roma Finance’s direct business and returning borrowers.

Charlotte Rutter

Head of marketing and comms at Roma Finance

In 2023, Charlotte showcased her passion for driving education and standards in the wider specialist finance market. Thanks to her expertise and extensive work building an education programme on the side, Charlotte was invited by the Association of Short Term Lenders, the Financial Intermediary and Broker Association, and the London Institute of Banking and Finance to become a key collaborator in crafting the curriculum and exam material for the Certified Practitioner in Specialist Property Finance qualification. Thanks to her work, the qualification has seen great success, with 50 people already certified just a few months after the launch. Her extensive contribution and passion for education earned her the esteemed Benson Hersch Memorial Award.

Justin Amos

Managing director at Millbrook Business Finance

Over the past 12 months, Justin has taken Millbrook Business Finance to new heights. He spearheaded the business’s rebrand and increased the firm’s lending proposition to offer commercial property and invoice finance, as well as merchant cash advances. These initiatives have not only helped over 500 SME business owners secure the finance they require but also resulted in a 53% growth in overall business compared to the previous year. Thanks to Justin’s efforts, the company has also doubled its team in 2023.

Karen Rodrigues

Head of sales at Market Financial Solutions

Despite having been part of the MFS team only since July 2023, Karen has made a significantly positive contribution to the business thanks to her work ethic and ambitious initiatives. She focused on expanding MFS’s product range to a wider range of borrowers and brokers; to achieve this, she solidified several new partnerships with intermediaries and mortgage clubs, thus increasing awareness of the firm’s lending proposition and driving business. Karen also completed a government-supported training course in order to help other people with their careers and professional wellbeing, and shared her expertise and knowledge on various topics, including the consumer duty.

Stephen Todd

Chief commercial officer and co-founder of VAS Valuation Group

The desire to educate both brokers and lenders on the intricacies of property valuations in a way that was easy to understand and access led Stephen to create VAS Group’s Knowledge Hub in 2023. As part of the project, he led the production of 20 videos on different valuation topics, such as new-build premiums and best outcomes when contesting valuations, to answer the most commonly asked questions about valuation and thus drive education. The videos are freely available on a dedicated Knowledge Hub area on the group’s website. Many brokers, lenders, and valuers themselves have praised this initiative, saying that it has helped improve their understanding of issues around valuations.

Ben Lawrence

Chief financial officer at MT Finance

Ben has played a key role in implementing MT Finance’s strategic initiatives across the group. In 2023, he secured a £500m senior funding line from JP Morgan, and a £30m revolving credit facility from Triple Point to help support the company’s growth plans. His work on obtaining this new capital has helped the lender to diversify and optimise its capital structure and product offering and to continue lending in a tumultuous market.

Angela Norman

Director of lending strategy and propositions at Recognise Bank

In 2023, Angela spearheaded Recognise Bank’s implementation of a new asset finance forward-flow product designed to tap into novel customer segments. This move significantly contributed to new business growth. She was also heavily involved in a digital product set to launch in 2024 to deliver much-needed access to finance for UK SMEs. Angela also took the lead on applying new consumer duty principles across lending in 2023. Beyond ensuring their integration into key lending offerings, she embedded them throughout the Recognise lending portfolio and used this as an opportunity to assess all the bank’s products, processes, and communications.

Josh Knight

Sales and marketing director at Octane Capital

Despite facing a multitude of new tasks when he was appointed Octane Capital’s sales and marketing director, Josh saw a gap in education in the specialist finance market—one he was ready to fill. During 2023, he created simple social media videos for brokers on various specialist finance topics from rising build costs and their implications for developers to HMO planning and licensing, title splits, yieldbased valuations, and bridging loan terms, among many others. On top of this, Josh has spearheaded Octane Capital’s first ‘Bridging Trends from Three Perspectives’ event, which gave 85 brokers insights into market trends from a lender, surveyor, and solicitor to help them capitalise on opportunities and write more business. Both his videos and the event were praised by several industry finance experts for providing honest, informative, and accurate information in a clear, easy-tounderstand, and fun way that has helped them in their day-to-day activities.

Tom Renwick

Head of business lending at Atom Bank

The last year has been an important one for implementing technology at Atom Bank, and Tom has overseen a host of crucial developments on this front. The digital platform the bank uses, Portal, which allows intermediaries to submit applications on behalf of their small business clients—even in cases with complex elements—has undergone a series of improvements under Tom’s leadership, with a greater focus on what matters to intermediaries and delivering these at a far greater pace. Tom recognised that this platform was not just for brokers but needed to be by them too, so he set up an intermediary panel to test the system throughout its development, providing valuable feedback and insights. That dialogue has resulted in a host of iterative changes to the user experience and core features over the past year, with 60 Portal releases taking place. Tom and his team have expanded Portal to incorporate Atom’s self-service Quick Quote tool, providing intermediaries with the ability to create and receive indicative, bespoke commercial mortgage quotes and alter loan parameters, around the clock and within seconds. This is a dramatic improvement for brokers, who all too often had to set aside time to contact busy field-based teams directly and hope for a swift response. Alongside this, Tom has overseen the continued investment in a suite of open data capabilities to improve credit decisions. This focus on automation and better use of technology has seen the average time from application to agreement in principle fall by 80% over the year, during which time Atom doubled its volume of SME applications. There has also been a 56% drop in application-to-offer times, achieved through policy, process and tech changes overseen by Tom, while 2023 marked three consecutive years of year-on-year growth in offer volumes, with over £3bn of quotes issued so far in this financial year.

Lucy Waters

Managing director and founder of Aria Finance

One of the most impressive things about Lucy is her ability to lead from the front; not only is she the managing director at Aria Finance, but she also manages her own pipeline of complex and often HNW cases. Lucy has continued to support a wide range of borrowers throughout the challenging 2023 market with rigour and a wholehearted commitment to premium customer service. Her style of leadership is incredibly hands-on, and she inspires her team with her dedication and passion. In the past 12 months, under Lucy’s direction, Aria Finance completed circa £500m worth of specialist lending, cementing its position as one of the UK’s leading specialist finance brokers.

Tom Cantor

Head of bridging finance at West One

During 2023, Tom focused on continuing West One’s improvement of the broker journey, driving originations, and further developing talent, among his many responsibilities as head of bridging. To achieve these ambitious targets, Tom trained and nurtured West One’s underwriting team, while personally handling some of the company’s most significant transactions. On top of this, Tom took additional leadership responsibility as the firm decided to merge the bridging and BTL sales forces to expand its coverage across the UK. Thanks to these initiatives, West One closed its largest-ever bridging deal in 2023, achieved record originations despite market challenges, sustained year-on-year loan book growth, and expanded into previously underserved regions.

Michael Allison

Commercial director at Roma Finance

Determined to help Roma Finance further improve its overall service, Michael was one of the key creators of the firm’s RomaFLOW lending process, designed to assist borrowers and the business in speeding up bridging completions. In addition to embedding the new RomaFLOW system into the fabric of the company, Michael continued to further improve it over the past 12 months with new features and tailor-made lending products. Thanks to his technological innovation, Roma Finance saw its new business loan book triple in 2023 as well as see a boost in repeat customers.

Louisa Holland-Hibbert

Senior underwriter at Fiduciam

Having identified an opportunity to boost Fiduciam’s proposition into other areas, Louisa has worked extensively and drawn on her specialist knowledge to expand the lender’s finance offering into Scotland. She has developed a tailored proposition to meet the finance needs identified in this specific area, and visited numerous areas in Scotland to promote Fiduciam’s new regional presence to secure additional business for the firm. Thanks to her expertise and hard work, Fiduciam’s Scotland team has expanded and completed £15m worth of transactions, as well as built an additional business pipeline of £40m for 2024.

Ashkan Nejad

Head of real estate finance at Ackroyd Legal

In 2023, Ashkan’s strategic initiatives led to remarkable improvements in business practices and industry standards. One notable instance involved his adept negotiation skills that streamlined the collaboration between lenders and developers. He implemented a novel approach that significantly expedited the deal-making process, reducing typical timelines by half while ensuring adherence to regulatory frameworks. His initiatives in fostering transparent communication channels between lenders and developers, backed by innovative technology, brought about increased trust and efficiency. By introducing customised software tools that facilitated smoother interactions and quicker decision-making processes, Ashkan managed to accelerate the approval and funding stages for various development projects. As a result, several high-profile projects were completed not only ahead of schedule, but also within budget, marking a paradigm shift in the industry’s expectations for deal timelines and profitability. The synergy between lenders and developers fostered by Ashkan’s interventions catalysed a positive ripple effect across the wider industry, inspiring similar collaborative models and raising the bar for efficient deal executions.

Marylen Edwards

Head of BTL lending at MT Finance

After MT Finance’s BTL proposition was soft launched to a select number of brokers shortly after Marylen joined, the plan was to go whole of market in the following months. The mini-Budget upended that and, in subsequent months, attention switched to protecting the pipeline. Every deal that the BTL team had committed to was honoured. The launch finally took place in March 2023. While this was later than had been envisaged, it was due to Marylen’s determination, experience, and steady hand that MT Finance was able to proceed only six months after the mini-Budget. Marylen is also committed to worthwhile causes, for example she has volunteered for Crisis at Christmas, working shifts with one of their specialist units that house the more vulnerable homeless over the festive period. She has also undertaken voluntary work with young offenders.

Steve Nobbs

Unregulated mortgages director at The Loans Engine

Having seen a pressing need for The Loans Engine to enhance its support for its brokers, Steve took no time to jump into action and make this happen. He was a key player in launching the firm’s specialist lending training sessions and product clinics, covering areas of specialist finance, including bridging, commercial, semi-commercial, and development loans. These sessions were designed to help brokers understand the intricacies of the industry and empower them to generate new business. This initiative proved to be successful; The Loans Engine has seen a surge of activity from a diverse range of brokers following the events.

Roxanne Goodman

Founder of Female Founder

Finance

It is well known that female-led businesses have been disadvantaged when it comes to obtaining commercial finance—a fact clearly highlighted in ‘The Allison Rose Review of Female Entrepreneurship’ report. While addressing this massive issue is a daunting task, for Roxanne it was a challenge she was more than willing to take on. Determined to balance the scales, Roxanne launched Female Founder Finance in 2023, with the aim of creating an inclusive and equitable ecosystem for women founders and entrepreneurs across the UK. To help female-led businesses secure the finance they need to achieve success, Roxanne set up a panel of funders across the commercial finance spectrum which have pledged to support these types of business. Since its launch, Female Founder Finance’s pipeline has exceeded £150m, and it has helped many businesses secure the necessary funds to create growth and jobs and expand operations worldwide. Additionally, several banks have created bespoke commercial finance products that reflect the specific risks that female-led businesses present from a credit perspective.

Sophie Ambrose

Head of operations at Albatross Lending Group

During 2023, Sophie was an instrumental player in Albatross’s evolution. She took on the responsibility of training new staff and continued to work extremely hard to keep things running. On top of this, Sophie was a key player in managing all the processes during the lender’s company revamp, which led to the firm’s successful rebrand.

William Edwards

Bridging business development manager at Market Harborough Building Society

In 2023, William enhanced the building society’s bridging finance team to include a case manager, underwriters, and intermediary support to provide more assistance and a tailored experience for intermediaries. He streamlined processes and led the implementation of its case hub for end-to-end bridging finance application processing online. He also led the team to deliver more bridging business in 2023, and overcome some challenging cases that intermediaries were struggling to place elsewhere to help their clients secure homes. His leadership also resulted in quicker turnaround times, especially for straightforward and well-packaged bridging cases, an improved intermediary journey, and much-needed proactive support for intermediaries as their cases progressed.

Andrea Glasgow

Sales director for specialist mortgages at Hampshire Trust Bank

Described as a trailblazer within both Hampshire Trust Bank and the industry, Andrea has shown dedication to improving the business and the specialist finance market through several routes, including recruitment, diversity and inclusion, and charity work. In her role as sales director—a job she took in July 2023—she has fostered a culture where gender should never be a barrier. Thanks to this approach, she increased the number of female BDMs on her team, which went on to achieve record-breaking deals under her leadership. Andrea’s impactful work extended beyond her workplace; during 2023, she participated in charity activities including a 25km midnight walk for St Barnabas Hospice, during which she raised £2,799.

Joe Aston

Sales and commercial director at Aria Finance

Educating the broker community on the opportunities the specialist finance industry can offer their clients is something Joe is passionate about. After reviewing the market and speaking with brokers and lenders, he realised there was a growing number of principals whose businesses had been hit by tighter lending criteria in the residential markets and the increasing number of product transfers. These principals voiced their uncertainty and apprehension around being able to engage with their clients effectively. Joe’s solution was to launch a series of educational private dining roundtables targeted at director-level personnel from a variety of businesses and banks. During these events, he would facilitate a group discussion predominately to inform guests about the state of the specialist lending space, which would cover current rates and criteria sweet spots as well as how to identify solutions to their clients’ complex requirements while offering a more comprehensive service through partnering with experts. Conversation points were backed up with real-life examples, expertise from the directors of Aria Finance, and input from industry experts. “Joe carefully and expertly leads conversation at a pace comfortable for everyone attending, covering all elements of specialist finance while answering any questions attendees may have to leave them feeling empowered and comfortable relaying the message to their teams and, ultimately, their borrowers,” said one attendee. The events proved to be a great success, generating both positive feedback from guests and an increase in business. Aria Finance saw its overall distribution grow by 15% in 2023, with completed business by attending firms up by 70–90%.

Jonathan Newman

Senior partner at Brightstone Law

Jonathan has continued to raise standards and push boundaries within the specialist finance sector, an example of which is when Brightstone Law, on behalf of a second-charge lender, took on a major high-street brand last year. The bank had accepted a loss to itself running into six figures, which caused the second-charge holder to suffer a complete shortfall. In this case, both loans had gone into default and possession orders had been obtained by both charge holders. The second-charge holder was on the cusp of repossession. The borrower claimed negative equity (taking both mortgages into account) and, shortly before enforcement was to take place, convinced the bank he had arranged a sale that promised the bank its best recovery return, with complete disregard for the interests of the second-charge lender. The bank took over the sale and sold the property to a buyer introduced by the borrower. The second-charge holder was wiped out and the bank accepted the sale proceeds. However, there were a number of red flags that should have alerted the bank to a sale at undervalue. The second-charge lender took the unusual step of pursuing the first mortgagee for breaching its duty of care. The second-charge holder’s case was denied entirely. Jonathan’s expertise, experience, and extensive understanding of the duties owed by all mortgage lenders led to a forensic scrutinisation of the bank’s process and conduct. Despite consistent denial of breach, the claim resulted in a substantial settlement in the second-charge holder’s favour. This case was a big win for the specialist finance sector and tells us that a well-known brand name is no guarantee of integrity. It also tells us that tenacity, perseverance, technical excellence, specialist expertise, and experience are key to successful property finance—qualities that Jonathan exhibited in winning this case.

Sophie Mitchell-Charman

Commercial director at LendInvest

Sophie has been praised for her strong work ethic and extensive knowledge of the specialist finance market, which she used during 2023 to successfully lead LendInvest during a tumultuous time. As part of her goal to further streamline the firm’s lending processes and improve its overall proposition, she has drawn on her expertise to introduce AVMs to its product range, and helped bring forth new tracker and seven-year fixed-rate mortgages. In addition, Sophie was a key player in creating LendInvest’s broker portal, which has helped the business streamline case management.

Jason Neale

Managing director at Quantum Mortgages

Landlords have been battered by numerous problems in the rental market in 2023—including difficulties in accessing BTL finance. Jason understands the importance of having a reliable lender for landlords and brokers alike. With this in mind, he chose to focus on providing finance for a range of clients—including affordable housing and providers of homes for vulnerable people—and to enhance the firm’s technology to reduce the number of documents required for deals, and thus further streamlining the lending process for intermediaries. Under his leadership and thanks to these initiatives, Quantum Mortgages quadrupled new lending since January 2023, doubled its headcount, and secured partnerships with numerous packagers, mortgage networks and mortgage clubs, which allowed it to further promote its BTL range.

Amy Baptiste

Head of specialist finance at LDN Finance

In 2023, Amy was the driving force behind many changes implemented at LDN Finance, all done to boost the firm’s efficiency. In addition to sourcing new business avenues, Amy created internal systems to ensure all tasks undertaken by the specialist side of LDN Finance, from reporting to lead management and case tracking, were run as smooth as possible. These changes have improved the operation of the business, which has in turn led to even better customer service throughout the year.

Martin Gilsenan

Chief originations officer at Atelier

Coming into 2023, Martin recognised the phase of the property cycle emerging: a period characterised by a squeeze in equity, combined with a simultaneous paring back from lenders, creating the most challenging conditions since the global financial crisis of 2007-09. In difficult times, choice is often the first thing to leave the market. Unwilling to be a part of this picture, he set himself the target of creating transparency and certainty for Atelier’s network, an objective that would ultimately deliver benefits for Atelier and its entire value chain. His idea was to initiate a series of roadshows across the country, which saw Martin and the Atelier team travel to Edinburgh, Leeds, Birmingham, Bristol, and Brighton. The events brought together developers, intermediaries, valuers, monitoring surveyors, and solicitors. The roadshows cemented or initiated relationships with numerous developers, intermediaries, and other professionals, which have played a significant role in Atelier’s volume of new originations. Being on the ground in the different cities allowed Martin and his team to get under the skin of local markets, meaning the lender has been able to work with developers on transactions linked to a greater range of asset classes within the living sector, significantly increasing its lending in the student accommodation and care home sectors. Additionally, Martin has grown his team, hiring experienced lending managers in Scotland and the South West.

Alastair Hoyne

Executive chairman at Finanze Group Alastair is no stranger to taking on big initiatives, and continued to do so in 2023. Driven by a desire to provide his bespoke products to a wider range of customers, Alastair launched Finanze Capital, the group’s own lending brand. He also led the creation of Finanze Success, a monthly subscription service that provides educational tools for new or seasoned investors, with the intention of improving knowledge in the specialist finance sector. The two brands have helped the industry by providing targeted funding solutions to clients and educational material to advisers and other experts. This has further boosted Finanze Group’s overall business and success, with the group reaching a major milestone in 2023 of issuing over £3bn of terms to date.

Lee Francis

Head of origination at CapitalRise

Lee has recently been promoted to head of origination at CapitalRise after two years as one of the team’s top performers. Between 2022 and 2023, he contributed almost 45% of the lender’s revenue, helping it double the size of its loan book. Lee sourced and helped deliver the company’s largest funding line to date, which proved transformational, bringing in a significant amount of additional capital to deploy in 2024. He also created a credit and portfolio team to support and monitor the growing loan book. Under his leadership in Q4 2023, CapitalRise surpassed £300m of total loans originated to help fund developments across London and the Home Counties valued at over £859m. With Lee’s direction, CapitalRise’s lending team is confident that it will triple its assets under management within the next 3–5 years.

Sundeep Patel

Director of bridging at United Trust Bank

As the leader of United Trust Bank’s (UTB) bridging team, Sundeep knows the value of the one-team ethos and the importance of good service. To ensure the bank continued to honour its commitments and achieve its service level agreements to better support customers during the tumultuous 2023, Sundeep took the step to split the firm’s bridging business into regulated and unregulated divisions, and bolstered the senior management team through a series of promotions and new hires. Through this comprehensive initiative, Sundeep increased UTB’s capacity to provide tailored support for brokers and customers, and improved the organisational culture and the overall performance of the bridging team. Thanks to these actions, UTB has completed over £350m of bridging loans in 2023, boosted its share of unregulated business, and increased its number of broker partners to over 1,000.

Andrew Charnley

Managing director at Assetz Capital

Assetz Capital’s decision to close its retail investment platform to focus solely on institutional capital for funding mapped out a long, arduous journey for the specialist lender in 2023—a challenge that Andrew was more than happy to take on. Throughout last year, Andrew led the team during the transition to becoming a fully institutional lender, extended the business’s key funding lines, and spearheaded the partnership between Assetz Capital and Atom Bank. Simultaneously, he orchestrated a resizing of the business to ensure Assetz was fit for purpose for its future growth and to service its client and introducer base. Andrew also helped launch an apprenticeship programme and strengthened the company’s charitable causes scheme as part of his ambition to boost the firm’s work in the social space. Thanks to his initiatives and leadership, Assetz Capital completed its transition towards a new funding base and passed the milestone of over £1.7bn lent to date. Beyond tangible business metrics, Andrew has been praised by his colleagues for bringing in a new sense of excitement and purpose to day-to-day work and setting the stage for Assetz Capital’s next stage of growth.

Andy Jones

Group director corporate (sales, lettings and BTR) at Leaders Romans Group

One of Andy’s considerable successes last year was compiling and publishing a white paper on the future of BTR in suburban areas, with the aim of driving understanding of this type of asset and its value within the UK property market. The white paper identified how BTR can provide a safe investment opportunity and how it can address supply/demand issues in the rental sector. Andy was praised for its publication and the knowledge it provided to the wider market on this asset type. In addition, his work has helped Leaders Romans Group and its specialist division, Three Sixty Space, to win a substantial contract with a large institutional provider of single-family housing, amounting to over 1,000 units in the first year alone.

PakSan Wu

Funding and portfolio manager at Pivot

Praised for his timely and accurate delivery of portfolio information, as well as his skills in managing relationships with multiple institutional funders, PakSan single-handedly led the negotiation and eventual agreement of a £70m funding commitment by two private equity funds in November. This new additional capital has and will continue to enable Pivot to scale its business in 2024 and beyond.

Michelle Walsh

Head of intermediary sales for commercial finance at Together

Having identified that Together needed to promote its lending proposition to its packaging partners, as well as improve brokers’ understanding of how to package and submit a case, Michelle set out to tackle these issues. After considering the type of content required and the formats that would be best received by brokers and suitable for all learning styles, she created Chalk, Together’s online educational hub, which comprises webinars, advice videos, guides, and infographics that help brokers through their application journey with the lender. This has helped Together expand its lending range to new clients and improved advisers’ knowledge.

An Inspired move

After a short hiatus, Gavin Diamond returned to the market in full force, brandishing a new specialist finance provider, Inspired Lending, together with Owen Bentley, who joined as the firm’s sales director. I sit down with the dynamic duo to find out more about the lender’s out-of-thebox proposition, why it is key to approach every client with an open mind, and why a tough market provides the best conditions for launching a business

Words by ANDREEA DULGHERU

L-R: Owen Bentley and Gavin Diamond of Inspired Lending

fter months of speculation about where Gavin Diamond would go following his stint at Spring Finance, the industry stalwart finally revealed in November his next career step: the launch of his very own firm, Inspired Lending.

The idea of creating a specialist lender wasn’t something he had harboured for years, but a great next step should the opportunity arise. “I didn't leave Spring with the intention of starting my own lender but, at that stage, I did think to myself that if the stars aligned and I could make it happen, then it would seem like the perfect opportunity to do it. It didn't come without a lot of thinking, soul-searching and sleepless nights, as it is a big decision, but my gut told me it was the right time.”

As the specialist market was hit by rising Bank of England base rates, inflation volatility, and other macroeconomic headaches, Gavin felt it was the perfect moment to step into the ring with a brand new firm. “The best time to start and new lender is in a challenging environment. When you’re small and flexible, there are things that you can do that are more difficult for others,” he says.

There were two essential puzzle pieces that Gavin needed to complete the picture: the right funding and the right people. This funding partner turned out to be the Pears family, with whom Gavin has had a strong relationship for over 10 years. Having known them for a while and given their property knowledge and experience in the market, he was confident they were the right people to go into business with. “One of the challenges of starting a new lender is finding people to work with who genuinely understand what you're doing and have a have a strong and detailed knowledge of the market and of lending. The last thing you want is to work with a partner who has a pot of cash but doesn't fully grasp the market. [The Pears family] get it—they know and understand the industry and they like it.”

The other key element to success was finding the right people to work with—and the best person was Owen Bentley, who joined Inspired Lending as sales director. Given the many years the two worked together while in the bridging department at United Trust Bank, Gavin jumped at the chance to team up with Owen once again. He knew their skill sets worked well together—and the feeling was mutual. Owen says: “When I learned that Gavin was doing something brand new, [joining him] was a no brainer—in fact, it was more like, ‘Why didn’t you tell me sooner?’. Having worked together successfully for four and a half years, we have an open, two-way communication. I know I can challenge Gavin, and he knows he can challenge me, and we're not going to throw the toys out of the pram if either of us says something the other doesn't like. We're co-invested in getting Inspired Lending from concept to becoming a very successful lender in the market.”

No set loan menu

Inspired Lending offers a range of shortterm specialist finance, including bridging and refurbishment loans secured against residential, commercial, semi-commercial, and industrial properties in England and Wales. What makes the proposition stand out from others’ is its lack of defined lending options. “One thing that we are keen not to do is have a raft of products. I’ve never been big on having these because, particularly within the specialist lending world, these products don't really mean an awful lot,” says Gavin. Owen agrees, adding that having rigid, set products can risk certain deals being pigeonholed. “The danger is you start to silo different types of deals and, all of a sudden, you lose that flexibility. And even those with quite rigid, extensive product guides, you'll find a deal will actually fit in two or three of those silos so, in the end, you're forcing yourself down a certain route.”

While Inspired Lending does not offer a set product range, it has some broad lending parameters that it will use when considering which deals to lend on. The firm is keen to provide loans of up to £5m—although it is open to going above this for the right deal—at a maximum of 70% LTV and on terms of up to 24 months, with rates of 1–1.25% per month on average. In addition to first- and second-charge bridging loans, Inspired Lending is also keen to provide light and heavy refurbishment facilities, the latter of which can be deployed in tranches.

“One of the challenges of starting a new lender is finding people to work with who genuinely understand what you’re doing and have a strong and detailed knowledge of the market and of lending. The last thing you want is to work with a partner who has a pot of cash but doesn’t fully grasp the market”

The reason for a proposition free of set products all boils down to Inspired Lending’s ethos: to provide straightforward deals and view every case with an open mind. “We’re so free and nimble in our approach because we don't have these funding line restrictions and the direction of travel is controlled by us. This is all ours to grow and shape as we wish, and the freedom that gives you in terms of looking at the deals is huge,” says Gavin.

Not about form-filling

“We’re so free and nimble in our approach because we don’t have these funding line restrictions and the direction of travel is controlled by us. This is all ours to grow and shape as we wish, and the freedom that gives you in terms of looking at the deals is huge”

After 15 years of working in the industry and seeing different operation styles, there was one thing Gavin was determined to avoid: having a rigid, paper-filled lending process. “The thing that is an absolute no for me is doing things for the sake of doing them, because your policy or process dictates that. My goal was to do my KYC in a way that was going to be user-friendly for the borrower but also tick all the boxes for me and not delay or over-complicate things,” he explains.

This is why, aside from the essential points that need checking for each deal, Inspired Lending’s underwriting process is bespoke and directly led by Gavin and Owen, who personally assess each deal on its merit and suitability for the lender’s risk appetite. As such, the team promises a much faster and streamlined lending process. “The key for us is to have the flexibility and the efficiency to get things done quickly,” adds Gavin.

This simple, approachable system makes Inspired Lending’s proposition appealing to brokers and borrowers alike, according to the two experts. “For all the years I've been in the industry, most property professionals are happy to pay 10–15 bps more on pricing if they know they can get the funds quickly and reliably,” emphasises Owen.

Having launched only a few months ago, the lender has already completed two shortterm loans, and its founder is confident it will achieve its lending targets for 2024 with

ease. In the near future, the firm is looking to diversify its funding so it can expand into other areas of specialist finance.

Ultimately, Gavin and Owen have one main aim: to make Inspired Lending the finance provider of choice for brokers and known for its deal flexibility and trusted delivery. “We wouldn’t be doing this if we didn’t want to expand and become successful. In due course, I do see us becoming a multidisciplinary specialist lender—that is the ultimate aim,” comments Gavin. “However, I’m not looking to run before we can walk. If you do things correctly and lay the foundations right from the beginning, growth should automatically come. We’re very much at the beginning, but we know where we are heading. Will that evolution line be straight? Absolutely not. Things [in the market] will change, but we are up for the journey and the challenge.”

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How inclusive hiring could help tackle the labour shortage

The UK’s construction sector continues to struggle with a lack of workers, exacerbated by Brexit and an ageing workforce. Could more investment in apprenticeships and targeting under-represented groups such as ex-offenders help?

Words by NIAMH SMITH

emands on the construction sector have continued to rise significantly over the years, driven by a multitude of infrastructure projects, the housing crisis, and technological advances. However, a lack of skilled workers is a persistent problem and continues to hinder the industry’s ability to carry out its increased workload.

The Construction Skills Network forecast an additional 225,000 workers will be needed in the UK by 2027. To achieve this, the sector must address the root causes of the labour shortage and explore innovative strategies to attract, retain, and develop a skilled workforce.

WHY THE LACK OF STAFF?

The construction sector has historically relied heavily on the free movement of workers from other EU countries. Before Brexit, 37% of London’s construction workforce came from EU member states, according to the London Assembly.

While a labour shortage in the UK has been a long-term problem, since Brexit, the industry has unsurprisingly been hit further with many skilled workers returning to their home countries after struggling to secure UK work visas.

A report by The Construction Industry Training Board (CITB) revealed that just over 10,000 migrant workers arrived in the UK to work in construction between 2019 and 2021, which was a significant decrease from the 40,000 that arrived between 2013 and 2015.

Stacey Hayes-Allen, director of corporate partnerships at Arden University, adds that the workforce is ageing, which is set to exacerbate matters: “The average age of a construction worker in the UK is 45 years, and many are nearing retirement age. As they retire, there aren’t enough young people entering the industry to replace them,” she says.

The workers themselves are aware of this issue. The Chartered Institute of Building (CIOB) found that 65% of them said there had been a decrease in the number of workers aged 16–30 years and 39% noticed an rise in those aged 60 or over. Furthermore, its report said 52% consider an ageing population to be a serious issue ahead for the construction industry.

As the demand for skilled workers continues to rise while supply dwindles, the industry is seeing a drop in quality and productivity, notes Niamh Evans, policy and public affairs officer at CIOB. “This hindrance not only affects the timely delivery of construction projects, but also makes it difficult for businesses to meet deadlines and deliver work to a high quality,” she comments.

Data from the Building Cost Information Service also reveals the labour shortage is pushing up wages, thus increasing employment costs. Its study found that the cost of building workers in the UK increased by approximately one-third between 2015 and 2021, compared to only 14.6% in Denmark and 14.1% in the Netherlands over the same time period.

“Diverse companies earn 2.5 times higher cash flow per employee, and inclusive teams are over 35% more productive”

START EARLY

Mark Burley, social value and partnership manager at housebuilder Keepmoat, explains that the industry must attract young people to make up for its ageing workforce. He says training programmes and apprenticeships can offer a realistic and achievable pathway to bring in new talent from schools and colleges.

The CITB estimates there are currently 74,000 construction apprentices enrolled in the UK, of whom 65% will complete their programme.

More of these schemes could help address the labour shortage for the construction industry; 55% of apprentices will immediately enter work and 58% of companies report that all their fully qualified apprentices remained with the organisation.

“Construction companies and housebuilders should invest in their employees. Structured training and guidance teach the necessary skills for success within the field,” Mark adds.

Arden University’s Stacey states that apprenticeships can help businesses encourage a diverse talent pool into the industry as well as their companies. “They open doors for those who didn’t have access to higher education at a younger age and therefore didn’t have the chance to gain a degree or postgrad qualification,” she says.

This route also covers university fees, which is of growing importance for the younger generation as they struggle with rising living costs, Stacey highlights. A particular benefit of apprenticeships, she explains, is that their content can be adapted to meet evolving needs. “As the construction sector is rapidly changing with the pace of technological advancements, the skills required are also changing. That’s why degree apprenticeship programmes can play an important role in ensuring employees have access to bespoke learning and development for their roles,” she notes.

REBUILDING LIVES

Construction companies should also introduce social mobility initiatives to recruit individuals whose backgrounds or personal circumstances can mean they are disregarded by employers, according to Keepmoat’s Mark.

For example, construction recruitment agency PSR Solutions established the Build a Career initiative in 2019 to support those in socially disadvantaged groups to gain sustained employment. The team works with domestic violence survivors, displaced refugees, ex-offenders, service leavers and veterans, and homeless people to provide them with careers within forward-thinking companies.

Keepmoat also partnered with His Majesty’s Prison Service and the National House Building Council (NHBC) to open a bricklaying academy at HMP Moorland, which is the first of its kind in the UK. The academy provides prisoners due to be released within 6–12 months with training that enables them to integrate back into society with up-to-date skills and experience in bricklaying.

Mark says the academy develops the prisoners’ skills in construction by teaching them how to use tools and equipment, mix cement, and build various types of walls to NHBC-approved standards. “It also supports those who wish to create a future career for themselves and, ultimately, have a second chance at life,” he adds.

The CIOB’s Niamh emphasises that these initiatives are crucial as people with criminal convictions are frequently overlooked by employers, causing companies to miss out on a source of potentially loyal and committed workers.

“Broadening the recruitment pool to include people with criminal convictions not only allows access to a wider range of talent and helps in closing skills gaps, but also contributes to improving diversity of thought and inclusivity within a business,” she comments.

MORE INCLUSIVE, MORE PROFIT

Stacey adds that companies must understand the benefits of inclusive recruitment to facilitate an open-minded approach when hiring. For example, employing people from a range of backgrounds will create a workforce with different viewpoints and insights into how to solve business problems, she says. “In fact, diverse companies earn 2.5 times higher cash flow per employee, and inclusive teams are over 35% more productive,” she states.

While apprentices require time and resources to be trained, they are nonetheless an investment that could provide the solution to the increased cost of workers created by the labour shortage. MTT Training has reported that three-out-of-four employers say bringing in apprentices has helped them to save on recruitment costs, retain staff, and improve employee loyalty.

This can also be a benefit of employing ex-offenders. The Chartered Institute of Personnel and Development calculated that the recruitment process to fill an average non-managerial vacancy costs companies approximately £2,000. Therefore, opening recruitment up to ex-convicts can help reduce hiring overheads, because prisons can help arrange interviews. Additionally, ex-offenders often place a high value on having a job as they desire to remain out of prison, which means they have high levels of loyalty and retention.

UNINTENTIONAL HURDLES

Even though these initiatives could help to address the labour shortage, a lack of awareness on the part of construction firms could cause problems.

Niamh says ex-offenders face substantial barriers to employment, stemming from both stigma around their crimes and practical issues resulting from their time in custody. “While many construction companies are open to employing individuals with criminal convictions and actively breaking down barriers to work, some businesses avoid recruiting from this pool or unintentionally create hurdles in their recruitment process,” she claims.

Therefore, construction companies should adopt an open-minded approach, evaluating job applicants based on their individual skills, personality, and circumstances, she suggests.

To promote fairer recruitment, managers should receive regular guidance, such as unconscious bias training, and ensure effective policies and procedures are in place to open up opportunities to all people, according to Go Construct.

Companies could also consider adopting Ban the Box, which removes any tick box from job application forms that asks about criminal convictions. If this is necessary, companies can move this question to later in the recruitment process to ensure they fairly consider an applicant’s skills, experience, and ability first.

“The government should also play a crucial role by improving the consistency of access to accredited qualifications in prisons, to equip offenders [with the ability to] turn their lives around and start a skilled career in construction,” Niamh adds.

Government support could also encourage more companies to take on apprentices, as funding schemes are a barrier for many firms when it comes to recruiting and upskilling staff, according to the CIOB .

The institute reports that many construction firms are paying both the apprenticeship and the CITB levy, which creates a financial burden rather than an opportunity to invest in apprentices.

Apprenticeships and initiatives to train those in disadvantaged groups, such as ex-convicts, have the potential to narrow the skills gap and help address the construction sector’s labour shortage. Encouraging diverse and inclusive workplaces also enables construction businesses to strengthen company performance and increase innovation.

However, regular managerial training and increased government support are required to encourage more firms to adopt these approaches. Without these, the construction sector could continue to lack the workforce it needs to meet its ever-growing demands.

VALUATIONS... WHY? WHAT? HOW? WHO?

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Property valuations are our business. We ensure valuations are more accurate and your lending decisions are clearer.

This is why we created Knowledge Hub, a library of short one-to-two-minute videos, bringing together our know-how and experience. We answer many of the commonly asked questions about valuations, property and the market.

Visit the Knowledge Hub at vas-group.co.uk, or to propose a topic for us to cover.

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Limelight

A glimpse into our ever-busy schedule

On Thursday 8th February, Medianett Publishing hosted its exclusive annual Directors’ Lunch in partnership with JMW Solicitors. With the glittering backdrop of Mayfair, we welcomed 60 influential directors from the pinnacle of the specialist lending industry to the prestigious Savile Club for an afternoon that redefined networking and collaboration. Can you spot anyone you know?

Photography by ALEXANDER CHAI

Up to 75% LTV available

Most asset classes considered

No maximum loan size