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The lender market
Development finance lenders,
tier by tier.
The UK development finance market is not one list of lenders. It is six kinds of capital, each with its own pricing, leverage and appetite. The right tier usually sets the price before any individual lender does. We work across 100+ lenders in all six.
- Lenders we work across
- 100+
- Lender tiers
- 6
At a glance
Typical terms by lender type.
Indicative ranges for 2026. Pricing on any one scheme depends on the site, the sponsor and the exit.
| Lender type | Typical pricing | Leverage | Arrangement fee | Experience | Best for |
|---|---|---|---|---|---|
| High-street banks | 1.5% to 3.5% over Bank Rate (about 5.25% to 7.25%) | Typically 60% to 65% LTGDV | 1% to 2% | Several completed schemes of similar size | Experienced developers on straightforward residential schemes |
| Challenger banks | About 7.5% to 10% all-in | 65% to 70% LTGDV, stretched senior to about 75% | 1% to 2% | Some track record, or a strong professional team | Mid-market schemes that need more leverage or a faster decision |
| Specialist lenders and debt funds | About 8.5% to 11.5% all-in | Up to about 75% LTGDV, or 85% to 90% of costs | 1.5% to 2% | First-time developers considered with the right team | Higher-leverage, complex or non-standard schemes |
| Bridging lenders | From 0.55% per month | Up to 70% to 75% LTV | 1% to 2% | Asset-led; experience matters less than the exit | Buying a site quickly, or bridging to a development facility |
| Mezzanine providers | About 12% to 18% p.a. | Takes total debt to 85% to 90% of costs | 2% to 3% | Delivery experience, or an experienced JCT main contractor and full professional team | Reducing developer equity behind a senior loan |
| Equity partners and family offices | Profit share, typically from 40% | Up to 100% of project costs alongside senior debt | Deal-specific | Varies; strong sites can offset limited experience | Developers short of equity, or schemes too large for their balance sheet |
The six tiers
Who actually funds these deals.
Different schemes need different capital. This is how each part of the market behaves.
High-street banks
The cheapest senior development debt in the market, priced off Bank Rate or SONIA. Credit is conservative: banks want an established track record, a meaningful equity contribution and usually an existing banking relationship.
Active in this part of the market: Lloyds, NatWest, Barclays, HSBC.
Development financeChallenger banks
Banks built around property lending. More flexible than the high street on sponsor experience and site type, and the main source of stretched senior debt at up to 75% LTGDV.
Active in this part of the market: Shawbrook, OakNorth, United Trust Bank, Aldermore, Paragon, Investec.
Development financeSpecialist lenders and debt funds
Non-bank lenders and private credit funds. They price higher in exchange for going further down the experience curve, into more complex sites and higher leverage points, including stretched senior to around 90% of costs.
Active in this part of the market: Octopus Real Estate, Puma Property Finance, Maslow Capital, Pluto Finance, LendInvest.
Development financeBridging lenders
Short-term lenders who fund site purchases, auction completions, light refurbishment and exits ahead of a longer facility. Speed and certainty of completion matter more than the coupon.
Active in this part of the market: Together, Market Financial Solutions, LendInvest.
Bridging loansMezzanine providers
Second-charge lenders who sit behind the senior facility and reduce the cash the developer needs to put in. Priced for the second-loss position, so lenders look hard at who is building the scheme.
Mostly specialist debt funds and private capital, matched to the senior lender on each deal.
Mezzanine financeEquity partners and family offices
Family offices, private equity and high-net-worth investors who fund the equity layer, or up to 100% of costs in a joint venture, in return for a share of profit rather than a coupon. Family offices tend to decide fastest.
Mostly family offices and private investors, who rarely publish criteria and are introduced deal by deal.
Equity and joint ventures
Named lenders are examples of firms publicly active in each part of the market, not a statement of any arrangement with Construction Capital. Lender selection is always deal-led.
The broker advantage
Four things a broker does that a price-comparison sheet can’t.
01
Wider access
One application reaches 100+ lenders. We know which are active, which have appetite, and which will move fastest for your scheme.
02
Better terms
Lenders compete for your deal. We use volume and relationships to negotiate rates, fees and covenant packages.
03
Faster decisions
Direct relationships with credit committees mean fewer rounds. We know exactly what each lender needs to see.
04
Structuring
Complex deals need creative stacks. We combine senior, mezzanine and equity from multiple lenders into one coherent facility.
Questions
Development finance lenders: common questions.
- Who are the main development finance lenders in the UK?
- UK development finance comes from six broad groups: high-street banks, challenger banks, non-bank specialist lenders and debt funds, bridging lenders, mezzanine providers, and equity partners such as family offices. High-street banks are cheapest but most selective; specialist lenders and debt funds lend further up the leverage curve and to less experienced developers, at higher pricing.
- Which development finance lender is cheapest?
- High-street banks usually offer the lowest headline pricing, typically 1.5% to 3.5% over Bank Rate, but only to experienced developers with a meaningful equity contribution. Compare offers on an all-in basis (interest plus arrangement and exit fees) rather than the quoted rate, because fees change the ranking.
- Do I need a broker to access development finance lenders?
- No, but most specialist lenders and debt funds take a large share of their deals through brokers, and many do not market directly. A broker who knows current lender appetite can put a scheme in front of the lenders most likely to approve it, rather than the ones that happen to rank on Google.
- Will a lender fund a first-time developer?
- Yes. High-street banks rarely do, but challenger banks, specialist lenders and debt funds regularly fund first-time developers. Senior debt to around 65% LTGDV or 85% of costs is achievable, and stretched senior, mezzanine or a joint venture can take that to 75% LTGDV or 90% of costs. The higher-leverage options usually require an experienced JCT main contractor on a fixed-price contract and a full professional team.
For current pricing by product, see our development finance rates table, or our guide to alternative development finance lenders.
Use the market
One call reaches the
right lender for your deal.
Send us the outline and we come back with indicative terms from the best-fit lenders inside a working day.