Development Exit Bridging Loans
Structured short-term finance designed to refinance expensive development loans once works are completed — or even during the snagging stage.
Bridging Finance Overview
What Are Development Exit Bridging Loans?
Development exit bridging loans are used to refinance an existing development facility once construction has reached practical completion — or is close to completion.
They are commonly used to reduce interest costs, remove pressure from development lenders, and provide time for asset sales or long-term refinancing.
Why Developers Use Exit Bridging
- Development finance interest rates are typically higher
- Sales may be progressing slower than expected
- Extension fees may apply
- Lenders may require full redemption at maturity
- Pressure to exit quickly may reduce sale values
Exit bridging can provide breathing space while reducing ongoing cost exposure.
Ready at Practical Completion or Snagging
In certain cases, development exit bridging facilities can be structured:
- Immediately upon practical completion
- During the snagging stage
- When minor works remain outstanding
Subject to underwriting and valuation, funding can be positioned to redeem the development lender promptly, helping avoid extension penalties or elevated default rates.
Typical Exit Strategies
- Sale of completed units
- Refinance onto investment facility
- Portfolio hold strategy
As with all bridging finance, a clear and evidenced exit strategy is essential.
Frequently Asked Questions
Can development exit finance reduce monthly costs?
In many cases, exit bridging may reduce interest compared to development finance rates, subject to terms and structure.
Do works need to be fully complete?
Facilities may be considered at practical completion or during snagging, depending on asset condition and underwriting.
How quickly can it complete?
Completion depends on valuation access and legal readiness. In many cases, bridging finance can complete within 2–3 weeks.
Refinancing Expensive Development Finance?
If your project is nearing completion and you wish to reduce cost exposure, we can review whether a structured development exit bridging facility may be suitable.