Fund your next UK property development with a senior loan

What is a Senior loan?

First charge lending.

Senior loans typically provide the bulk of finance required to acquire an asset or undertake a development. Secured by a first legal charge, this type of debt sits ahead of all other parties in the capital stack.

This type of lending relies on Loan to Gross Development ("LTGDV") and Loan to Cost ("LTC") caps, and attracts a fixed return. Facilities tend to cover up to 80% of the total costs.

How does a Senior loan work?

Priority position.

In combination with our junior products, Shojin currently provide senior debt in the form of bridge loans to support acquisitions or short term financing.

When funding development schemes and larger strategic acquisitions, we work with preferred parties and can provide a full stack solution together.

Apply for funding

Our team of experts will review your proposal and determine whether it fits Shojin or our preferred lenders criteria. Once approved, we will submit an indicative offer letter. Upon acceptance and payment of the commitment fee, we will undertake due diligence, instruct a valuer and project monitoring surveyor as well as engage with solicitors.

Draw down

Upon receipt of all the required reports and completing all internal checks, legal documents will be signed and funds released within 5 business days.

Repayment

Once the scheme concludes, the loan will be repaid through an agreed exit strategy which can include unit sales or refinancing.

FAQs

If you would like to find out more about our flexible funding solutions, please get in touch with a member of the team.

What is the minimum/maximum ticket size?

We provide between £1,500,000 - £6,000,000 per transaction. When working with our preferred senior lenders, we can provide up to £50,000,000 per transaction.

What are your senior debt product parameters?

Shojin currently bridge loans to assist with acquiring assets, and our loans go up to 70% LTV. When working with our preferred senior lenders, they can provide funding up to 65% LTGDV and 80% LTC, which excludes any junior finance provided by Shojin.

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Do you take any security?

As standard, all senior loans require a first legal charge, personal guarantee and a debenture over the borrowing SPV. Additional security may be required on a case by case basis.

What type of opportunities do you fund?

We currently provide bridge loans towards acquisitions. However, we work with preferred senior lenders who can provide development funding, finish and exit loans and asset finance.

What are your typical terms?

Our typical terms last between 6 - 24 months.

"SMEs play a critical role in helping alleviate the significant demand-supply imbalance that has led to a housing crisis within the UK. Shojin partner with developers by providing the most vital piece of the funding stack so that they can increase supply of housing whilst delivering exceptional outcomes for all stakeholders involved.

We are actively lending and have continued to support our partners despite recent macro-economic uncertainty caused by Brexit, Covid and higher interest rates, as the housing shortage shows no signs of slowing and businesses must continue operating.”

Nadav Albin

Head of Lending, Shojin