Lenders tighten grip on developer costs squeezed by labour and material spikes
As higher material costs settle, it has become clear that is only one part of the story, and for Chris Gardner, joint CEO of the development lender Atelier, not the most important part. Gardner says: “You can’t manufacture labour, and to my mind the chief inflationary threat now is the rising cost of employing people, rather than materials.”
The gathering economic clouds are already beginning to change some lenders’ appetites. Firstly the lender will be looking hard at the developer’s chosen location for their scheme as part of its due diligence, Gardner says: “If the UK does dip into recession, property prices in some areas may correct – so we’ll want to be certain that a scheme will deliver the right sort of properties in the right area to achieve the best possible sale value.”
Bridging Loan Directory 7 Sep 2022
Click here to read the full article.