Nottingham Development Finance
Case Study

Case Study: City Centre Residential Development

How we arranged development finance for a residential conversion project in City Centre, Nottingham. From initial enquiry to completion in 15 months.

By Construction Capital•15 February 2026

This case study illustrates how Construction Capital arranged development finance for a residential conversion project in City Centre, Nottingham, where average property values are £300 per square foot.

The Project

A developer with three completed projects approached us to fund a permitted development conversion of a former commercial building into residential apartments in City Centre.

Key Numbers

| Metric | Value | |--------|-------| | Location | City Centre, Nottingham | | Project Type | Residential Development | | GDV | £2,400K | | Build Period | 15 months | | Local Rental Yield | 5.8% | | Planning Approval Rate | 81% |

The Challenge

The developer needed to move quickly — the vendor had set a 6-week exchange deadline. Traditional bank funding would have taken 8-12 weeks, risking the loss of the site. Additionally, the developer wanted to maximise leverage to preserve capital for a second project in the pipeline.

Our Solution

We structured a combined senior debt and mezzanine facility:

  • Senior debt: 60% of GDV at 7.5% per annum, providing the primary development funding with staged drawdowns
  • Mezzanine finance: Top-up funding taking total leverage to 85% of costs, secured by second charge
  • Total developer equity: Reduced to just 15% of total project costs

    • The key was finding a senior lender comfortable with City Centre's market dynamics. Nottingham's 81% planning approval rate and 52 active development sites gave lenders confidence in the local market.

    The Timeline

  • Week 1: Initial enquiry received, site visited, indicative terms issued within 48 hours
  • Week 2-3: RICS valuation instructed, planning consultant engaged, QS cost plan reviewed
  • Week 4: Formal offers issued by both senior and mezzanine lenders
  • Week 5-6: Legal completion and first drawdown — meeting the vendor's deadline

    • The Outcome

    The project completed on time and within budget at 15 months. All units were retained as buy-to-let investments, refinanced onto long-term mortgages at the enhanced value.

    The developer's return on equity exceeded 25%, significantly enhanced by the leverage structure we arranged. They have since returned to fund two further Nottingham projects through our panel.

    Lessons for Nottingham Developers

    1. Speed matters — Having a broker with established lender relationships cuts weeks off the process 2. Leverage enhances returns — Combining senior and mezzanine finance significantly improved the developer's ROE 3. Local knowledge counts — Understanding Nottingham's planning environment and market values helped secure competitive terms 4. Exit strategy flexibility — With 5.8% rental yields in Nottingham, developers have the option to sell or hold

    Discuss your Nottingham project with us — indicative terms within 24 hours.

    Case study arranged by Construction Capital. Details have been adjusted to protect client confidentiality. Rates and terms are indicative.

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