How to raise debt, a recent article for the LCCI's Business Matters magazine
Raising debt for developments more easily, even in a Covid 19 world
An expert article written for Business Matters, the London Chamber of Commerce International magazine
The aim of the article was to bring out the positive. There are many lenders in the C19 world eager to lenf, if you have expert help to navigate your way to a good deal. Bear in mind that the best deal is about the trade-offs as well as the headline of price and leverage. In those trade offs is the combination of contingency and various guarantees, costs overrun and interest shortfall that bulk up your obligation to a lender...
How to get the best deal from a lender in the midst of Covid19?
Yes, we are in the middle of the extraordinary times but remember that we have passed the worst of it. Lenders, especially the mainstream banks, will want to be seen to be supportive to the industry. The housing shortage has probably become worse since the start of the year due to lost construction time. The important point is that we know the mainstream lenders have their challenges and, good for developers, their challengers - new lenders keen to develop new relationships.
Yes, like a lot of things the construction industry will change, with longer build periods to accommodate social distancing and greater focus on the subcontractors and on the sourcing of materials. This combination may well push up costs and increase the build time but that will be the same for all everyone, developers and lenders. Indeed some developers, even one very large one, have already worked out the distancing issue and remained on site throughout.
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