3 minute read
Viewpoint: Keeping funders happy – confidence, robustness and security
08 Aug 2019
In development and construction, understanding the process and the varying needs of different parties is vital in managing what can often be a complicated process. And this is also how to instil confidence in all parties needed to deliver a successful development, not least funders.
From having commercially acceptable property, occupier, and construction-related legal documentation in place to ensuring all parties are committed to the same end goal – funders want a sense of confidence when looking to invest, and at Ashfield Land we get this.
We often buy sites, work through the planning process, and secure key pre-lets with tenants using our own resources before securing a funder or forward buyer, depending on whether we intend to hold or sell the development. As such, these parties are often introduced mid-project, reinforcing the need to have a robustly structured project that will instil confidence in our abilities and deliver best value.
We endeavour to get the necessary agreements in place in a timely fashion, including peripheral ones associated with physical delivery such as Section 278, wayleaves, land transfers and regulatory compliance. It is paramount to ensure that these agreements do not adversely affect the investment and that any timelines within them not only provide flexibility and enhance deliverability of the project, but also provide necessary protection to the investment.
We have also found that our understanding of the issues affecting management of a trading development allows us to deliver a better, more considered product to the benefit of the occupiers as well as the investors.
Our Sinclair Retail Park scheme in Evesham is an excellent example of this. We acquired the site in early 2018 with our own resources, the site had planning permission and one pre-let. Whilst helping facilitate the relocation of the existing occupier, we secured 100% pre-let to Aldi, TK Maxx and Home Bargains, making it a very attractive project to deliver either for ourselves or investors.
After appointing contractors and starting on site, we secured the onward sale of the development to a large property investor, who had the confidence to fund a well-structured investment which was already well on its way to completion. We have just achieved practical completion and the estate opens for trade in September once the tenants complete their fit out.
Development can be challenging, especially when dealing with so many aspects of a scheme as well as the various occupiers, investors, consultants, contractors, sub-contractors, and third-party regulators, each with their own interests. Understanding and managing these robustly gives investors the confidence to work positively with us at Ashfield land.
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