Structural works, planning and conversions
Heavy Refurbishment Finance
Facilities for projects that change a building: extensions, conversions, structural repair and change of use. Sized against the end value at up to 75% LTGDV, drawn in stages, from £100k to £5m.
Typical heavy refurb terms
Underwritten against the building you finish, not the one you buy
The defining feature of heavy refurbishment finance is that the lender lends against the gross development value. That is what makes ambitious projects fundable: a £250,000 building with £150,000 of works and a £550,000 end value supports a much larger facility than any loan sized on day-one value could. The trade-off is process. Expect a GDV valuation, a monitoring surveyor, staged releases and a lender panel an order of magnitude smaller than for light works.
Because the panel of bridging lenders is small and criteria genuinely differ, lender selection does most of the work on price. The spread between the best and worst quote on the same heavy refurbishment loan is routinely 0.2% per month plus materially different drawdown terms. The difference between a well-placed and badly-placed facility compounds over a 15-month project, which is why heavy refurbishment bridging finance rewards broker specialisation more than any other product we arrange.
The exit strategy is underwritten as hard as the works. Sale and refinance are the standard exit strategies; how much you can borrow is shaped by which one you choose, because a refinance exit is tested against term-lender criteria at application. Where a scheme finishes with unsold units, development exit bridging finance can replace the facility while sales complete. Plan the exit strategy first and the rest of the structure follows.
Projects we place as heavy refurbishment
- Extensions and wrap-around remodels with structural openings
- Loft and basement conversions
- Commercial-to-residential conversion (offices, retail, pubs)
- Single dwellings converted to HMOs or flats
- Structural repair: subsidence, roof structure, fire damage
- Permitted development schemes (see the PD finance guide)
A worked example: office-to-flats conversion
Worked example
Purchase of a small office building at £300,000 with £190,000 of conversion works into four flats under permitted development, GDV £680,000, exit by refinance onto a portfolio buy-to-let mortgage.
Figures
Indicative figures for illustration only. Lender criteria vary and every figure is confirmed in a formal offer. The refinance shown repays the facility in full; investor cash covers the balance of purchase, fees and works float between drawdowns.
The three documents that decide heavy refurb applications
Every heavy refurbishment underwriter reads the same three things first: a costed, stage-by-stage schedule of works; comparable evidence supporting the GDV; and the professional team's track record. We rebuild these with you before submission. It is unglamorous work and it is why our heavy refurbishment loans complete rather than stall at credit committee. The same preparation shortens every later step: valuers query less, bridging lenders' QS reviews pass first time, and drawdowns release on schedule because the paperwork anticipated the questions.
Heavy refurbishment finance questions
Structural work, anything requiring planning permission or building regulations sign-off beyond routine works, and any change of use. Extensions, loft and basement conversions, structural repairs, commercial-to-residential conversion, single dwelling to HMO, and projects where works cost more than roughly 50% of the current property value all sit in the heavy category.
Loan to gross development value: the total facility (purchase advance plus works funding plus rolled interest) expressed against the end value of the finished property. At 75% LTGDV on a £400,000 GDV, the whole facility is capped at £300,000. Lenders usually also cap day-one advance at 70-75% of the current value, so both tests must pass.
The works budget is split into stages agreed at offer, each released after the lender's monitoring surveyor confirms the previous stage is complete and on budget. Releases typically land within a week of inspection. The discipline protects you too: it catches cost overruns early, while there is still budget to fix them.
For works that need it, most lenders want planning granted before completion, though many will offer terms while a decision is pending and a few lend day one against permitted development rights. If your project runs under PD, our permitted development finance guide covers the evidence lenders want in place of a planning grant.
Evidence that someone on the project has delivered comparable work: you, your contractor or your project manager. A first-time developer with an experienced fixed-price contractor and a contingency in the budget is financeable. A first-timer self-managing a structural conversion with no contingency is not, and we will say so rather than submit a doomed application.
Yes, conversions are the core of the product: offices to flats, pubs and retail to residential, houses to HMOs. Lenders underwrite the end residential value and the credibility of the schedule of works. Where the project tips into ground-up territory or needs a development facility above £5m, we arrange it as development finance instead and will tell you which side of the line your project sits.
Talk to us about your project
Tell us the property, the schedule of works and the exit. We will come back with indicative terms, usually the same working day.