Mezzanine Development Finance
Unlock Additional Funding for Your Property Development Project
Specialist Mezzanine Finance for Experienced Property Developers
Reduce your equity contribution and increase your development funding with specialist mezzanine finance. We compare lenders, assess the overall funding structure and personally manage your finance from initial enquiry through to completion.
Increase Your Development Funding
Mezzanine finance can provide additional funding above your senior development loan, reducing the equity required to complete your project.
Compare Funding Structures
We assess senior debt, stretched senior and mezzanine finance to identify a suitable balance between borrowing levels, cost and flexibility.
Managed Through to Completion
Your dedicated broker coordinates lenders, negotiates funding terms and manages the finance process from enquiry through to completion.
Mezzanine Development Funding Capabilities
We work with specialist development finance providers offering mezzanine and structured funding solutions.
130+
Specialist Lenders
Up to 95%
Loan to Cost
Flexible
Senior & Mezzanine Structures
Tailored
Funding & Repayment Arrangements
Indicative funding capabilities only. Loan amounts depend on GDV, total project costs, available equity, developer experience and lender criteria. Maximum funding levels may not be achievable together.
What Does Mezzanine Development Finance Look Like?
Mezzanine finance is an additional layer of borrowing that sits behind the senior development lender. It can help bridge the gap between the senior loan and the developer’s available equity, although the overall funding structure and repayment arrangements require careful consideration.
Borrowing & Equity
Mezzanine funding can increase the total amount borrowed against project costs and GDV. We assess the senior facility, additional mezzanine borrowing and the remaining equity required from the developer.
Loan term
Mezzanine finance is typically structured around the development programme and senior loan term. We consider construction timescales, sales periods and sufficient contingency for unexpected delays.
Interest
Mezzanine finance generally carries a higher interest rate than senior debt because of its subordinate security position. Interest may be rolled up, with some arrangements also incorporating exit fees or a share of development profits when leverage is very high.
Fees & total cost
We compare interest, arrangement fees, legal costs, potential exit fees and any profit-sharing arrangements. Our assessment considers the overall cost of senior and mezzanine funding, not simply the headline interest rate.
Security & Approval
Mezzanine finance may be secured through a second charge or share security. The senior lender must permit the arrangement, and an intercreditor agreement will often be required between the funding parties.
Repayment
Mezzanine finance is generally repaid from development sales or an agreed refinance, after the senior lender’s repayment requirements have been satisfied. We consider how the total debt will be repaid and the likely effect on project profitability.
All finance is subject to lender assessment, valuation, legal checks and project viability. Funding levels, drawdowns and completion are not guaranteed.
What to Consider Before Using Mezzanine Finance
A development facility needs to work throughout the project, not just on the day the loan completes. These four areas can make a significant difference.
Your Senior Lender’s Requirements
Not all development lenders permit mezzanine funding. It’s important to establish whether your senior lender will accept additional borrowing and the security arrangements required..
Total Borrowing & Equity
Higher borrowing can reduce the cash you need to contribute, but it also increases your financial commitments. We assess borrowing against both total project costs and projected GDV.
Development Profitability
Mezzanine finance is generally more expensive than senior debt. We consider the additional finance costs and their impact on your projected profit and overall development returns.
Your Repayment Strategy
he scheme needs sufficient value and cash flow to repay both facilities. We consider construction delays, potential cost increases and lower-than-expected sales proceeds.
How We Help Get Your Mezzanine Funding in Place
You’ll deal directly with an experienced development finance broker who reviews your project, compares appropriate funding structures and coordinates the finance process with lenders and your professional team.
1. Assess Your Development
We review your development appraisal, existing or proposed senior facility, projected GDV, available equity, previous experience and repayment strategy.
2. Find & Compare Funding Options
We assess senior, stretched senior and mezzanine finance options, identifying suitable providers and comparing borrowing levels, total costs and lending conditions.
3. Structure & Progress the Funding
Where mezzanine funding is appropriate, we coordinate the proposed structure with the senior and mezzanine lenders, including security arrangements, credit requirements and legal documentation.
4. Manage through to completion
We work alongside lenders, solicitors and other professionals to progress outstanding requirements and coordinate the funding through to completion.
Completion is subject to lender approval, satisfactory valuation, due diligence and legal work. Funding is not guaranteed.
Jamie Lloyd | Specialist Finance Broker
Jamie specialises in Development & Mezzanine Finance, using his experience and lender relationships to find practical solutions, particularly for complex projects.
You’ll deal directly with him from first enquiry through to completion. He takes ownership, working alongside you and your professional team to solve problems, provide clear advice and keep things on track.
An experienced specialist in your corner from project concept to completion.
Get a Mezzanine Development Finance Quote Here
Tell us about your project requirements, and we’ll be in touch to discuss your options.
Peace of Mind With A Trusted and Regulated Broker
Xcel Finance is Directly Authorised by the Financial Conduct Authority (FCA) and a member of the National Association of Commercial Finance Brokers (NACFB), providing added reassurance that we work to high professional standards and are committed to delivering excellent customer outcomes.
Your Mezzanine Development Finance Questions Answered
What is mezzanine development finance?
Mezzanine development finance is a form of additional borrowing that sits behind a senior development loan. It can increase total development funding and reduce the developer’s equity contribution. Because the mezzanine lender ranks behind the senior lender for repayment, mezzanine finance is generally more expensive than traditional senior development funding.
How much mezzanine finance can I borrow?
The amount available depends on the senior debt, development costs, gross development value, project profitability and developer experience. Some specialist providers advertise combined borrowing of up to 90–95% of project costs, subject to separate GDV and other lending limits. We assess what may be achievable for your individual scheme.
How much does mezzanine finance cost?
Mezzanine finance typically costs more than senior development debt because the lender accepts a higher level of risk. Interest rates, arrangement fees and repayment terms vary between lenders. Some providers may also require an exit fee or share of profits. We compare the total cost of suitable funding options so you’re in control.
What is the difference between mezzanine and stretched senior finance?
Mezzanine finance typically involves additional borrowing behind a senior lender, often through a separate provider. Stretched senior finance generally provides increased leverage through a single lender. Both can reduce the amount of equity required, but the costs, security arrangements and lending criteria differ.
Can I add mezzanine finance to an existing development loan?
Potentially, although this depends on the senior lender’s consent, the available security and the financial performance of the development. Some senior lenders prohibit additional borrowing or second-ranking security. We can review the existing facility and identify potential options.
Do I need previous development experience?
Mezzanine lenders will generally place significant importance on the developer’s track record, financial position and ability to deliver the project. Requirements vary, although mezzanine funding is typically better suited to experienced developers with viable schemes, suitable equity and a clear repayment strategy.