ICG Longbow has entered into residential development finance following the raising of a £400m fund.
The alternative lender raised the fund from a single investor and has already deployed funds for five projects including ones in Southampton, Brighton, Bristol and Cardiff.
The fund will target residential development outside central London in the mid-market, which the company believes has been neglected by both high street banks and the challenger bank markets.
The loans will cover an average of two-to-three years and will focus on projects where the developer is aiming at local renters or owner occupiers in preference to buy-to-let.
The company believes another niche it can fill will be in providing loans of up to 80% of the development cost, much higher than the average 60% of other lenders. The risk in this level of lending is offset by higher margins and a profit share element for Longbow.
• To send feedback, e-mail mike.cobb@estatesgazette.com or tweet @MikeCobbEG or @estatesgazette
