From land bridge to development finance: lessons from Pivot’s £6.6m Kent facility

A structured transition from land to delivery

Bridging Loan Directory reports that Pivot has completed a £6.6m development finance facility for Highbrook to refinance an existing land bridging loan and fund 13 homes at Oast Farm in Hever, Kent. The 20-month facility is structured at 70% loan-to-gross-development-value and provides funding through practical completion and sale.

For developers, the transaction highlights the importance of treating land acquisition and construction finance as connected stages of one capital strategy. A bridging loan can provide the initial route into a site, but the subsequent development facility must reflect the construction programme, project costs, delivery team and intended exit. Those requirements should be considered before the land facility approaches maturity, rather than once refinancing becomes urgent.

The value of lender continuity

Pivot had underwritten the land in February, giving its team prior knowledge of the site, borrower and part of the delivery team before arranging the development facility. Keeping the project with the same lender therefore meant that the move into development finance was supported by an existing understanding of the transaction.

This does not remove the need for fresh credit assessment, valuation or monitoring. Strutt & Parker carried out the valuation, MDA Consulting was appointed as monitoring surveyor and Dovetail Law acted for Pivot. It does, however, show why developers should assess a bridging lender’s capacity and appetite to support the next stage when selecting acquisition finance.

Structure should follow the delivery plan

Pivot senior credit manager Stefan Pahontu said the lender structured the facility around how the scheme would be delivered and the borrower’s specific needs, rather than applying a generic development model. That distinction is significant. Headline leverage is only one part of a development finance proposal. The lender must also be comfortable with how the project will move from its current position to practical completion and sale.

At Oast Farm, former agricultural barns will be replaced by a mix of house types and sizes alongside a small lake. XP Property will manage the development, while Total Homes will act as contractor. The named responsibilities across the development, contracting, valuation, monitoring and legal work demonstrate the breadth of parties involved in taking a scheme through delivery.

What developers and investors should take from the transaction

• Plan the refinancing route alongside the original land bridge, including the proposed development lender’s requirements and the timing of the transition.

• Present a facility request that reflects the actual construction and sales strategy, rather than relying solely on headline loan-to-gross-development-value.

• Establish clear responsibilities across the borrower, development manager, contractor and professional team so that the lender can assess delivery capability.

• Allow sufficient time for valuation, monitoring and legal work, even where the incumbent lender already knows the borrower and site.

Implications for the financing market

The case also illustrates how relationship-led underwriting can influence the progression of a transaction. Pivot relationship manager Michael Tarateo said the funding relationship began after meeting Highbrook at an open day for its Stonebridge development, which subsequently won the RICS South East Residential Development award. In this instance, direct engagement preceded both the land underwriting and the later development facility.

For brokers and borrowers, the broader point is that lender selection should account for the whole project journey. Price, leverage and term remain relevant components, but so do continuity, sector appetite and the ability to structure around a specific delivery plan. The £6.6m Oast Farm facility provides a clear example of a land bridge being refinanced into development finance with the same lender, supporting the scheme through practical completion and sale.