How I Underwrote a £20M Residential Development in London

I underwrote a £20M resi development in London.

Investors get paid before the first private sales...

- 14-month build + 6-month sales programme
- £16.2M total cost (land + build + finance)
- £4.07M projected profit
- 20% margin on GDV / 25% on cost
- £1.7M equity sought (20% p.a. over 24 months)

To fund deals like this, I ask 4 questions:

1) What stage of risk are we in?

- Full planning consent secured
- Site with solicitors, terms agreed
- Planning conditions being discharged

2) What makes the location work?

- North London is an affluent area
- Affordable units conservatively priced
- Blended GDV of £523 psf across 38,792 sq ft

3) How is the downside protected?

- Investor secured via second charge over the site
- Affordable housing receipt at Golden Brick
- Peak debt capped at £10.5M before sales
- 5% contingency built into cost stack
- Senior debt at 65% LTGDV

4) Can we control the exit?

- Units are forward sold to the Housing Association
- Private sales phased over the final 6 months
- A further £50M GDV pipeline planned

The affordable housing structure is the standout here. Early receipts reduce lender risk, compress peak gearing, and derisk the equity position before private sales even begin.

My verdict:

- Strong fit for family offices seeking fixed returns
- Strong fit for private credit and bridging lenders
- Medium fit for anyone needing near-term liquidity

If you allocate to real assets, let's connect 👋