Buying the site and building in one facility
Many UK development lenders can fund the site purchase and the build in a single facility. They release the site advance when you complete the purchase, then fund build costs in stages as the work is valued on site. Interest runs only on money drawn, so the site advance is charged for the whole term while later build tranches are charged for less.
Some developers instead buy the site with a bridging loan first, often while planning is secured, then refinance into development finance before building. If you already own the site, use the development finance calculator with a site advance of zero.
Typical UK terms
Facilities are usually sized against the finished value: many lenders cap the total debt at around 60% to 65% of GDV, measured on the gross loan including rolled-up interest and fees, and at a loan to cost that can reach the 80s for experienced developers. Terms commonly run 6 to 24 months. Arrangement fees are often 1% to 2% and some lenders charge an exit fee of around 1%.
Worked example: a £2 million scheme
A developer buys a site for £500,000 with build costs of £1,500,000 and a GDV of £3,000,000. The lender advances 60% of the site price, £300,000, and 90% of the build costs, £1,350,000, in 15 monthly tranches of £90,000. The total loan is £1,650,000, which is 82.5% of the £2,000,000 cost.
At 0.75% a month, rolled up and compounded monthly, with a three-month sale period after the build, interest comes to £159,598.93. With a 2% arrangement fee of £33,000 and a 1% exit fee of £16,500, the total cost of finance is £209,098.93 and £1,826,098.93 is repaid at exit, 60.9% of GDV.
Profit after finance is £790,901.07, or 35.8% on cost. With simple rolled-up interest instead of compound, interest would be £151,875.00.
What this calculator does not decide
This estimate does not cover planning risk, the lender's own valuation, monitoring surveyor sign-off or your experience. Stamp Duty Land Tax on the site, professional fees and contingency should be in your costs if you want them in loan to cost. Development finance for companies and investors is usually unregulated, so read the facility letter carefully.
If you already own the site, use the UK development finance calculator with a land advance of zero.
For the tax on a residential site purchase, use the Stamp Duty calculator .
Use the right country page
This page stays in pounds and uses UK development terms: a monthly rate, rolled-up interest, an arrangement fee and loan to GDV on the gross balance. The country choices above the inputs open separate local pages. Choosing United States opens the US acquisition and construction loan calculator, which uses an annual rate, origination points, an interest reserve and loan to ARV on the loan amount. The inputs reset and amounts are not converted.
Inputs for the site acquisition finance calculator
Site purchase price
What you pay for the site, before Stamp Duty and finance costs.
Build costs
Construction, professional fees and contingency for the whole build.
Gross development value (GDV)
The expected value of the finished scheme, usually from the lender's valuation.
Acquisition advance
The share of the site price the lender funds when you buy.
Build costs funded
The share of build costs the lender releases in stages.
Quoted interest rate
The rate in your quote, not the APR. UK development finance is usually quoted per month.
Rate quoted per
Month for a monthly rate. Year (nominal) divides an annual rate by twelve.
Build period
Months over which build funds are drawn, one tranche at the start of each month.
Sale or refinance period
Months after the build while the full loan is outstanding.
Draw pattern
Even, front-loaded or back-loaded tranches of the build facility.
How interest is paid
Rolled up and repaid at exit, compound or simple, or paid monthly.
Arrangement fee
A percentage of the total loan, paid at the start and not added to the loan here.
Exit fee
A percentage charged when you repay. Enter zero if none.
Exit fee based on
Whether the exit fee is a percentage of the total loan or of the GDV.
Other finance costs
Broker, valuation, monitoring and legal fees you pay separately.
Lender loan-to-cost limit
The highest loan as a share of site price plus build costs.
Lender GDV limit
The highest loan to GDV the lender allows, compared here with the gross balance at exit.
CALCULATOR QUESTIONS
UK site acquisition finance calculator questions
Can development finance pay for the site as well as the build?
Often, yes. Many lenders fund part of the site price on purchase and the build in stages within one facility, subject to planning and their valuation.
How much of the site will a lender fund?
It varies by lender and scheme. The total facility is usually limited to around 60% to 65% of GDV and a maximum loan to cost, so check both limits.
Why is the interest lower than the rate times the full loan?
Build money is drawn in stages, and each tranche is charged only from the month it is drawn. The site advance is charged for the whole term.
Should I use bridging to buy the site first?
Many developers do, especially before planning is granted, then refinance into development finance. Compare the cost of both routes.
What happens when I change country?
The United States option opens the separate US acquisition and construction loan page, in dollars, with its own defaults. Your inputs are reset rather than converted.