Glossary definition
Practical Completion
The stage at which a building project is deemed complete and fit for its intended purpose, even though minor snagging items may remain. Practical completion is typically certified by the contract administrator or architect and triggers important contractual consequences including the release of retention, the start of the defects liability period, and the handover of the building to the client.
Definition
The stage at which a building project is deemed complete and fit for its intended purpose, even though minor snagging items may remain. Practical completion is typically certified by the contract administrator or architect and triggers important contractual consequences including the release of retention, the start of the defects liability period, and the handover of the building to the client. For lenders, practical completion is a key trigger for releasing the final drawdown or transitioning to a development exit facility.
See also
Closely related terms.
Building Regulations
The statutory standards that all building work in England and Wales must comply with, covering structural integrity, fire safety, energy efficiency, drainage, and accessibility.
Monitoring Surveyor
An independent surveyor appointed by the lender to inspect the development site at regular intervals and verify that construction work has been completed to the required standard before each drawdown is released.
Retention
A percentage of each construction drawdown held back by the lender as a safeguard against cost overruns or incomplete works, typically 5% to 10% of each drawdown amount.
Development Exit Finance
A short-term loan that replaces a development finance facility once construction is substantially complete, providing time to sell units at optimal prices.
Further reading
Guides that touch this term.
Guide
How Does Development Finance Work? A Complete Guide for UK Developers
A ground-up guide to how development finance is structured in the UK, covering loan mechanics, drawdown schedules, monitoring surveyors, and what lenders look for in your application.
5 min read readReadGuide
Legal Due Diligence in Development Finance: What Solicitors Check
Legal due diligence is the backbone of every development finance transaction. This guide explains what solicitors investigate, common issues that delay completions, and how to prepare your legal pack.
9 min read readRead
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