The ultimate brokers guide to UK short term property development finance

Short term property development finance is a powerful tool for brokers working with experienced property investors and developers. It provides the speed and flexibility needed to take advantage of time-sensitive opportunities, fund site acquisitions, and push forward with builds, refurbishments or conversions.

This guide is designed to help brokers confidently advise clients on when and how to use a property development loan, what criteria to focus on, and how to present deals that are structured for approval. If you’re sourcing UK development loans for your clients, this overview will sharpen your understanding and help you secure the best outcomes.

What are short term property development loans?

Short term property development finance refers to loans used to fund construction, refurbishment, or conversion projects over a short timeframe. They’re designed to support the build or transformation stage of a project before a defined exit is triggered, for example, a sale or refinance onto a longer-term facility.

Our Development Loan offers terms up to 24 months, with funding available for up to 70% of GDV (90% LTC) in the amounts of £500K to £3.5M. This product is built to allow your client to move quickly and start construction without unnecessary delays.

Who are these loans for?

Short term property development finance is designed for your clients who have a clear strategy and a strong exit plan. Your typical borrower is likely to be an experienced developer, builder, or investor with a track record of delivering similar projects.

Development Loans can be used for a wide variety of developments. Some involve ground-up development, others may be extensive refurbishments or conversions of office space into residential. Mixed-use projects, such as flats above retail units, can also be supported where planning is in place.

However, smaller refurbishment projects or those that do not require planning permission may be best served by a Light Refurbishment Loan or our Alternative Overdraft facility.

Key benefits and risks

One of the main appeals of short term development loans is speed and adaptability. Traditional finance routes can be slow and restrictive, especially for borrowers working against tight completion deadlines or chasing auctions. We can often quickly make decisions in principal, and once approved, the funding is available in stages so that developers can manage cashflow efficiently.

But as with any financial product, there are risks. These loans rely heavily on the borrower’s ability to execute the project and complete the exit plan. If construction overruns or costs increase significantly, the borrower may struggle to repay within the agreed timeframe.

As a broker, your value lies in identifying these risks early. Projects should be fully costed, and feasibility tested, and making sure the client understands the timeline, their obligations, and has a solid backup plan. A robust exit strategy is essential. If the plan is to refinance, the borrower should be mortgage-ready when the time comes.

The broker’s role in structuring the deal

Brokers play a central part in getting a development deal off the ground. Sourcing the right lender is only the start. You also bring the pieces together to make sure the deal runs smoothly and meets the lender’s expectations.

That includes guiding your client through key points such as acceptable planning status, whether the build schedule and costs stack up, and what additional security may be required. Helping the borrower prepare a detailed proposal with accurate financials and timelines can significantly speed up approvals.

Brokers also help manage expectations around drawdowns and interest payments. Interest is often retained or rolled up in short term development finance, so making sure your client understands how this affects their loan balance is important. You’re the one who can spot the common sticking points before they cause issues later on.

What lenders like us look for

We always look at deals in their entirety, not just the numbers, but the people and plans behind them. However, there are some common themes that matter on every project.

Developer experience always carries weight. We like to see the borrower has delivered similar projects before or is working with a team that has. Good quality project managers, builders, and surveyor support all contribute to confidence in delivery.

Viability is equally important. We review the site value, build costs, and project GDV. Planning permission, building regulations, and local market demand will all come under scrutiny. We also want to see a clear and credible exit plan, ideally backed by comparable sales evidence or agreement in principle from a term lender.

We are able to make decisions quickly because we focus on the key issues and cut through unnecessary admin. We’re also happy to discuss complex deals early, even before full documentation is ready.

Trends and opportunities for the rest of 2025

The UK property market continues to attract developers who see opportunity in converting underused space or bringing small residential schemes to life. Refurbishment of tired housing stock, conversions under permitted development rights, and small site builds are where we’re seeing strong interest this year.

One area that has seen more activity is the repurposing of high street and commercial space. Developers with planning consent or clear rights to convert are taking advantage of competitive purchase prices and low build costs. If the numbers work, these are ideal for short term property development finance.

From a regulatory point of view, EPC requirements and planning reform are worth keeping an eye on, particularly around minimum energy performance. Lenders are increasingly interested in the EPC of the final product, and exit strategies can depend on achieving certain ratings.

As for interest rates and inflation, borrowers are watching these carefully. With fixed costs being more attractive, many are keen to complete projects and lock in longer-term finance before further changes.

Real use cases of the Development Loan Our Development Loans are available in the amounts of £500K to £3M from 3 to 24 months, with an LTV up to 70% (90% LTC).

These loans provide funding for land acquisition, construction costs, interest, and associated fees. We also provide an extended sales period, and once practical completion is achieved, we provide the option for a top-up advance if additional funding is required.

To enable smooth project exits, we offer reduced bridging rates during the sales phase or a tailored Development Exit Loan, giving your clients the flexibility and time needed to finalise sales under the best possible terms.

Let’s take a quick look at two deals recently funded through our Development Loans.

Supporting a contractor’s first residential development in Slough

A seasoned building contractor took on his first solo property development venture; a scheme of eight flats in central Slough. Initial work had begun some years earlier, funded through retained profits and an expired bridging facility. However, as the project neared completion, additional funding was required to finish the build and furnish the units, which were destined for the rental market under Assured Shorthold Tenancies.

That’s where Alternative Bridging stepped in. We provided a residential development loan that enabled the contractor to complete construction and bring the flats to a lettable standard. The finance was structured to give the borrower the breathing space and support needed to finish the project.

Following completion, the developer successfully refinanced into a longer-term commercial loan; an exit strategy that was smooth and timely. Not only did this allow the contractor to retain the development as a rental asset, but it also marked a strong first step into the world of property development.

Transforming a Victorian care home in Warrington

Elsewhere, an experienced developer in Cheshire undertook the ambitious transformation of a disused Victorian care home into 14 supported living apartments. With planning consent already in place and a sale pre-agreed with a local social housing provider, the fundamentals were sound. However, a development loan of £2.13 million was needed to bring the project to life.

Alternative Bridging worked with the developer to understand the vision, and structure a finance package that matched the project’s needs. The combination of a proven development track record and a secure exit through the agreed sale allowed us to offer enhanced leverage, while also building in the time needed to exchange contracts with the end buyer.

Three months later, with funding in place, the conversion began. The result was the successful delivery of much-needed supported housing and a hassle-free exit for the developer. This case demonstrated the value of clear communication, shared objectives, and the flexibility that Alternative Bridging brings to every deal.

Speak to us about your next deal

If you’re working with a client on a development or conversion project, speak to our team. We’re here to support brokers with fast decisions, straight answers, and a flexible approach to funding.

If you’re looking to see how a Development Loan can support your client, our experienced BDM’s are ready to help.

You can call us on 020 8349 5190, email us hello@alternativebridging.co.uk or send us an enquiry to discuss your next deal and answer any queries you may have.