Atelier launches offsite and modular construction lending framework
While there is broad agreement in the real estate sector about the transformative potential of offsite and modular construction techniques, there has long been a tendency to see them as tomorrow’s technology.
For SME developers, these Modern Methods of Construction (MMC) offer significant opportunities – from better build quality and increased sustainability to reduced build time – but they also come with challenges.
Recent research by Savills shows that 7.5% of the new homes delivered in the UK – 15,000 homes a year – are already being built using offsite or modular techniques. That figure is forecast to surge to 20% – 40,000 homes a year – by 2030.
Compared to conventional construction techniques which use widely available materials, MMC supply chains are still maturing, and not all lenders, from development lenders to high street mortgage lenders, are comfortable or adept at funding non-traditional schemes.
Our Offsite and Modular Construction Lending Guide has been produced with the help of more than 30 experts from across the modular and offsite manufacturing community, including real estate professionals and trade bodies such as the NHBC (National House Building Council) and BOPAS (Buildoffsite Property Assurance Scheme).
Chris Hall, Innovation Services Manager at NHBC, said: “The potential benefits of offsite construction are clear; consistent build quality, reduced costs and time on site, and strong sustainability credentials.
“More developers are considering these Modern Methods of Construction, and that’s why Atelier’s lending framework is so timely. By making it easier for residential developers to incorporate offsite technology into their plans, and by providing the finance and support they need to build their schemes successfully, Atelier is addressing market challenges in a clear and concise way.”
Terry Mundy, BOPAS Consultant, added: “For all the good work that has gone into raising industry standards in the design, manufacture and installation of offsite construction systems across the UK, one of the challenges that has proven harder to overcome is reassuring lenders to provide finance for such offsite schemes.
“By introducing its offsite and modular construction lending framework, Atelier is now raising the bar in the development finance sector, to facilitate the positive shift towards modular and offsite construction.”
We’ve created a clear lending framework, and published detailed eligibility criteria, that set out how and when we will lend on well-researched, well-costed schemes that use modular and offsite technology.
We’re offering loans ranging from £5m to £40m, at up to 70% LTGDV, to SME developers and intermediaries seeking finance for schemes that meet our eligibility checklist.
Our goal is to be the lender of choice for developers who decide offsite is right for them – a trusted, expert partner who understands the technology and can provide reliable finance, a competitive interest rate and ongoing support, right through to the successful completion of their schemes.