– Alternative lender fills gap left by traditional banks retreating from lending to SME residential developers –
London, 30 May 2017: Zorin Finance, the alternative property lending specialist, announces that it has just completed its largest loan to date. The £26 million loan to developer Vision Homes will fund the building of 82 properties in South West London and takes Zorin’s lending to date over £200 million.
The business, founded by entrepreneur Luke Townsend and backed by a fund managed by MW Eaglewood ( part of the Marshall Wace group of investment managers under common control) and Sir John Beckwith’s Pacific Investments, has put risk management at the heart of all decision making. It has now funded a total of 78 loans with zero capital losses.
Zorin is supporting the delivery of new homes in the UK which otherwise would not be built without new, alternative sources of financing for SME housebuilders, given the lack of appetite to lend by mainstream banks and the recent struggles of peer to peer lenders to establish themselves properly in the residential development market. This is reflected in the fact that SME housebuilders were responsible for 50% of new housing production in the 1980’s, falling to 25% in 2008 and further still to 15% last year. With alternative lenders’ share of the development finance market having doubled in the last 3 years, Zorin hopes to contribute to the renaissance of smaller housebuilders.
Luke Townsend, CEO of Zorin Finance, said:
“We established the business recognising the fact that the lending industry had failed to adapt to changing customer needs and the market environment. Alternative lending in residential development is growing meteorically each year, with traditional lending in decline. It is clear from the success we have had to date that SME developers welcome our flexible, swift and tailored approach to lending, typically on terms out of the reach of traditional lenders.
“With limited financing a major contributor to the UK’s housing shortage, we aim to support the re-establishment of the SME housebuilding industry to deliver crucial new homes. The combination of our real estate, asset management and technology expertise enables us to deliver a superior service which we believe will help continue to grow our market share for many years to come.”
Parma Sulh, CEO of Vision Homes, said:
“Zorin Finance offered us an attractive borrowing proposition, based on their expert knowledge of the property sector, flexibility, transparency and ability to move swiftly. It is clear to us that alternative lenders such as Zorin offer a crucial way for housebuilders to realise their developments under challenging market conditions and deliver important new homes for Britain.”
Zorin typically offers development finance and bridging loans for between £1m and £50m and, unlike traditional lenders, is able to offer loans up to 90% of loan-to-cost and 70% of loan to GDV.