Homes England and development finance platform Invest & Fund have expanded their lending alliance as part of plans to hit the government’s one-and-a-half million new homes target.
The refinanced agreement will boost the fund from £25m to £47.5m, extend the term of the fund to March 2030 and “continue to focus on supporting SMEs”.
The partnership will offer development loans up to £4m at a maximum loan to gross to development value (LTGDV) of 70% and maximum loan to cost of 85%.
The expanded partnership will help to facilitate the building of an additional 600 homes, expanding on the 107 homes already built.
Homes England struck the seven-year partnership in 2020, and the aim of the alliance was to boost the finance available to SME developers so they could grow and deliver more homes at pace.
The partnership created a £25m revolving fund to help small builders with construction loans of up to £2.5m to back schemes of two homes upwards at up to 80% loan to cost.
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Homes England also offers direct lending that provides development finance to housebuilders building five or more homes per year.
Marcus Ralling, chief investments officer at Homes England, said: “Small and medium housebuilders play a vital and essential role in driving the delivery of new homes where they are needed most.
“This refinancing demonstrates our ongoing commitment to supporting the small builders that are crucial to building a diverse and resilient housing sector. By nearly doubling the fund and extending its availability, we’re providing sustained, long-term support to help SME developers grow and deliver more homes at pace.”
Robert Burgess, chair at Invest & Fund, added: “Invest & Fund are delighted to be working with Homes England to support SME developers and ensure that they have access to vital funding to deliver much-needed new homes across the country.”
