Property Development Finance in Scotland
Securing the right property development finance in Scotland is critical to the success of any project. Local planning requirements, regulatory complexity, and lender criteria make expert guidance essential.
At Evolve Finance, we specialise in arranging property development loans in Scotland, supporting developers at every stage — from site acquisition through drawdowns to final exit.
Request a Callback.
WHAT IS PROPERTY DEVELOPMENT FINANCE?
Property development finance, often referred to as a property development loan, is a short to medium-term funding solution designed to cover the purchase and construction costs associated with residential and commercial development projects.
This type of funding is commonly used for ground-up developments, including new-build housing schemes, mixed-use sites, and small commercial builds requiring staged funding to support construction costs as work progresses.
Development funding also supports property refurbishment and conversion projects, such as office-to-residential schemes, barn conversions, and the redevelopment of redundant buildings, as well as developments ranging from single plots to larger multi-unit schemes, regardless of whether the completed properties are sold on the open market or retained as long-term investments.
HOW DO PROPERTY DEVELOPMENT LOANS WORK IN SCOTLAND?
A property development loan in Scotland typically follows these stages:
Initial Funding: A portion of the loan is released upfront to help purchase the site or fund early costs.
Stage Payments: Further funds are released in tranches, based on progress and valuation milestones.
Interest Payments: Interest is usually rolled up and paid at the end of the term, keeping your cash flow intact during the build.
Loan Repayment: The loan is repaid once the project is sold or refinanced, often via a development exit loan, or a long-term buy-to-let mortgage.
Lenders assess both the feasibility of the scheme and the experience of the development team. While first-time developers can still access property development finance in Scotland, experienced operators with a strong track record often unlock more favourable terms and higher loan-to-cost ratios.
Developer Insight – Managing Stage Drawdowns in Scotland
One of the most common causes of project delay we see is mismatched expectations around drawdown certification timings. Surveyors must physically inspect works before funds are released. Developers who build realistic inspection lead-times into their cashflow projections and maintain early communication with monitoring surveyors tend to progress far more smoothly than those working to optimistic schedules.
WHAT IS THE MINIMUM LOAN FOR PROPERTY DEVELOPMENT IN SCOTLAND?
There is a minimum loan amount of £750,000 to a maximum of around £50 million for development loans, however bridging loans fill the gap for smaller development projects from £50,000 to around £2 million.
Developer Insight – Borrowing Maximums vs Deliverable Reality
While headline figures of 70% LtGDV attract attention, in practice lenders focus far more heavily on cost stability and exit certainty than maximum leverage. Developers presenting conservative GDVs, contingency buffers, and fully costed build schedules routinely achieve smoother approvals than those pushing upper leverage limits with optimistic profit assumptions.
HOW ARE PROPERTY DEVELOPMENTS FINANCED?
Debt Financing
Property development finance is the most common route and forms the backbone of most property developments. Development loans typically run for 6 to 30 months and are structured so capital is released in stages aligned to build progress and valuation inspections rather than paid upfront. In practice, outcomes are dictated less by headline loan sizes and more by programme accuracy, contractor availability, and contingency planning.
Developments supported by fixed-price build contracts, warrant-ready designs, and clearly documented exit strategies consistently progress more smoothly than schemes relying on optimistic timelines or provisional cost assumptions.
Equity Funding
Equity funding introduces third-party investment capital into a project in exchange for a share of profits rather than fixed monthly interest payments. This approach can reduce servicing pressure during the build phase and enhance overall stability when leverage would otherwise be stretched.
However, effective equity structures require clearly defined profit waterfalls, governance arrangements, and exit provisions to protect development control and investor alignment. Poorly structured equity can introduce costly delays if objectives or ownership expectations are not aligned from the outset.
Joint Venture Funding
Joint venture funding is an alternative model that enables developers to partner with landowners or capital providers who contribute either land or funding in return for profit participation instead of charging interest. We regularly structure joint ventures where developers contribute planning expertise and project delivery experience, while partners provide site ownership or financial strength.
This structure can allow viable schemes to proceed where conventional deposit or affordability hurdles would otherwise restrict access to traditional property development loans in Scotland.
HOW MUCH CAN YOU BORROW?
The amount you can borrow through a property development loan in Scotland depends on several key factors:
Loan-to-Cost (LTC): Most lenders will fund 65–75% of total project costs (land + build).
Loan-to-GDV: This is often capped at around 60–70% of the estimated end value.
Developer Experience: More experienced developers may be able to borrow more or negotiate better terms.
Exit Strategy: A clear plan for how the loan will be repaid (sale or refinance) is critical.
PROPERTY DEVELOPMENT FINANCE IN SCOTLAND — KEY DIFFERENCES YOU NEED TO KNOW
While funding for property developments follows similar principles across the UK, Scotland operates under a distinct legal and planning framework that can materially affect funding timescales, risk assessment, and lender appetite.
Factors such as the Scottish conveyancing system, the requirement for both planning permission and a building warrant before construction, and the impact of Land and Buildings Transaction Tax (LBTT) all influence how lenders assess viability and structure offers north of the border.
Understanding these nuances is essential when structuring a compliant, lender-ready funding proposal.
Read our full guide: 👉 How Property Development Differs in Scotland vs the Rest of the UK (Full breakdown of legal processes, planning stages, warrant requirements, and lender underwriting adjustments.)
SCOTTISH PROPERTY DEVELOPMENT MARKET — TRENDS & OPPORTUNITIES
Market conditions play a central role in development funding approvals. Lenders assess not only build feasibility, but also local sale values, rental demand, transaction volumes, and supply constraints when underwriting new schemes.
From pricing stability and rising private rents to shifting construction activity levels and regional demand hotspots, the Scottish development landscape continues to evolve — and these changes directly influence GDV calculations, exit strategies, and achievable loan leverage.
Staying informed allows developers to structure projects that align with current lender appetite and maximise funding outcomes.
Explore our latest market analysis: 👉 Scottish Property Development Trends 2025–2026 — Market Review & Lender Outlook (Up-to-date statistics, lender insights, and strategy guidance for residential developments, conversions, and refurbishment-led schemes.)
Our Insight – Market Data Context
Our wider market analysis draws on publicly available sources including Registers of Scotland, Citylets rental reporting, property portal sales data, and institutional lender transaction feedback. Full statistical breakdowns are published in our annual Scottish Development Trends review.
WHAT TYPE OF PROJECTS QUALIFY
We regularly assist in securing development funding for:
• New Build Homes: On greenfield or gap sites.
• Conversions: Including barns, churches, and redundant buildings.
• Office-to-Residential Conversions: City and Urban locations.
• Renovations: Of derelict or below-market-value properties.
• Multi-Unit Developments: Such as student accommodation or HMOs.
• Build to Rent Developments: For developers aiming to retain completed units as long-term rentals, our Build to Rent solutions offer a seamless path from construction to letting.
HOW PROPERTY DEVELOPMENT LOANS WORK
Typically, property development lenders:
• Advance up to 70% of the land or property value initially.
• Release the remainder in stage payments, certified by a monitoring surveyor.
• Require an exit strategy, like a refinance or sale, to repay the loan.
Lenders often place significant emphasis on local experience and planning credibility. Working with a reputable architect or contractor can enhance your proposal for a property development loan in Scotland.
CAN YOU GET 100% DEVELOPMENT FINANCE?
In certain situations, yes. We've arranged full development finance for clients who:
• Own the land outright.
• Purchase at a discount.
• Offer additional property as security.
• Enter joint ventures with landowners.
For example, we recently secured 100% funding for a client using an unencumbered site just outside Glasgow as additional security, requiring no upfront capital.
WHAT DO LENDERS LOOK FOR?
Strong property development finance applications typically include:
• Detailed Development Appraisal: Including GDV, costs, and timelines.
• Planning Permission and Building Warrant: Required in Scotland for approval.
• Exit Strategy: Refinancing to a buy-to-let mortgage or planned sale.
• Track Record: Or a capable team with verifiable experience.
Additional lender requirements might include a build schedule, contractor quotations, and relevant insurance cover.
Developer Insight – What Actually Strengthens an Application
Applications that progress fastest are those that arrive fully documented. Clear costings aligned to current market rates, build programmes matched to seasonality, and early confirmation of contractor availability consistently outperform vague estimates and provisional scheduling.
WHAT IF YOU'RE BUYING AT AUCTION?
Speed matters. We offer specialist auction finance for buyers acquiring land or sites for development at auction. With agreements in principle within 48 hours, our solutions help you meet tight completion deadlines confidently.
CASE STUDY: INVERNESS BROWNFIELD REDEVELOPMENT
A client secured a 70% loan to acquire a derelict commercial site in Inverness. Once planning was granted for six residential flats, we arranged full property development finance in Scotland alongside a remortgage exit using a BRRR-style funding solution. Managing staged drawdowns amid local contractor delays was critical to delivery, but with structured support, the scheme completed on budget and on schedule.
Developer Insight – Why This Case Secured Approval
This project succeeded because the remortgage exit was agreed in principle prior to drawdown. In the current funding climate, lenders show clear preference for pre-validated exits over speculative resale strategies, particularly on smaller or semi-commercial schemes.
LET'S TALK NUMBERS (and Reality)
Based on experience across property development loans in Scotland, here are some insights:
• Planning Delays: Typically add 4–6 weeks—factor this in.
• Pre-Planning Acquisitions: Usually require strong fallback security.
• Surveyor Fees: £500 to £1,500 depending on project scope.
• Profit Margins: Must be realistic and supported by GDV evidence.
These figures reinforce the importance of working with a specialist adviser experienced in structuring property development loans in Scotland.
TYPES OF PROPERTY DEVELOPMENT FINANCE IN SCOTLAND
- £750,000 to £50 Million.
- LTGDV up to 70%.
- Up to 100% of Build Costs.
- Market leading fixed interest rates set on a deal by deal basis
- Maximum Term up to 30 Months.
- Indicative terms within 24 hours.
- £750,000 to £30 Million.
- LTGDV up to 60%.
- Up to 100% of Build Costs.
- Market leading fixed interest rates set on a deal by deal basis
- Maximum Term up to 30 Months.
- Indicative terms within 24 hours.
- £750,000 to £25 Million.
- LTGDV up to 55%.
- Up to 100% of Build Costs.
- Market leading fixed interest rates set on a deal by deal basis
- Maximum Term up to 30 Months.
- Indicative terms within 24 hours.
DOWNLOADABLE CHECKLIST RESORCE
To assist you, we’ve prepared a downloadable Development Finance Checklist covering:
• Appraisal Essentials: What lenders expect.
• Key Documentation: Planning, costings, schedule, and insurances.
• Timeline Milestones: From application to build completion.
• Risk Planning: Identifying and managing red flags.
This tool will streamline your development journey.
GETTING STARTED
We’re more than a broker—we’re your development finance partner. Whether you're a seasoned professional or starting your first project, we provide funding solutions built around your goals.
Let’s build something together. Contact us today.
Get in touch for a no-obligation discussion and learn how we work hand-in-hand with developers to structure tailored property development finance in Scotland, drawing on over 30 years of experience supporting projects of all sizes across the Scottish market.
WE SPECIALISE IN
Market leading property development loans in Scotland for Refurbishment and New Build development projects from a single unit project to multi unit projects and commercial to residential conversions.
Typical loan amounts start from £750,000 to £50M with loan terms from 6 to 30 months for Refurbishment and New Build developments.
For development projects below the typical £750,000 development finance threshold, take a look at our development bridging loan option from £50,000 to around £2M.
Our Development Finance Experience.
A development exit loan becomes relevant when your property development project is approaching completion or has already concluded, but you’re awaiting final sales.
It is suitable for one property, small developments and is commonly used for multi-unit projects.
This financial solution offers developers the essential flexibility to raise capital and seamlessly transition from one project to the next.
Decision in principle in 4 hours and fast completion.
Our Development Exit Finance Experience.
Build to Let Development Finance also known as Build to Rent Development Finance, is readily available for new build, refurbishment and commercial to residential conversions properties.
Build to Rent projects seamlessly convert to commercial term finance upon project completion.
For smaller build to rent development projects or single unit refurbishments see our bridging loans in Scotland alternative from £50,000 to around £2M.
Our Build to Rent Finance Experience.
3 REASONS TO CHOOSE US AS YOUR SOURCE FOR PROPERTY FINANCE.
Highly Experienced
We have over 30 years experience and can offer innovative financing methods for developers and investors.
Services
We offer Bridging Finance, Refurb & New Build Development Finance and Buy to Let Mortgages.
Quality Support
We'll keep you informed every step of the way and if required, continue to support even after completion.
DOWNLOAD OUR FREE PROPERTY PROFIT CALCULATOR
We built the Property Profit Calculator App as an aid for Property Developers & Investors
We wanted to build an app that had a real convenience and benefit to others in our property and finance world.
The App is Forever Free to use with or without a funding requirement.
Easily assess the viability of your property project within 60 seconds, then if required, book a time slot to discuss your project with a funding expert.
what our clients think about us - matters
Absolutely delighted with the service levels and attention to detail provided and was never left wondering what was happening with my residential development bridging application, I saved over £1000 in legal fees and it completed ahead of schedule. Happy Days.
Mr. C from Glasgow. Property Developer.
JUST SOME OF THE LENDERS WE WORK WITH
