Simon Whitfield

An interview with Simon Whitfield: 'There are still opportunities for pragmatic lenders' in development finance

In an interview with Development Finance Today, Simon Whitfield, head of development finance at Castle Trust (pictured above), reveals the impact of a recent revamped proposition, the three questions to ask developers and the specialist lender’s early plans to obtain a banking licence.


Castle Trust revamped its development finance offering in October — how has business been since?

The new proposition gained traction very quickly and we have worked on some great schemes with very knowledgeable and ambitious developers. The development finance lender market is very competitive, but the level of interest that we have seen shows that there are still opportunities for pragmatic lenders that can take a flexible approach, and there continues to be strong demand from developers.

Can you tell us more about Castle Trust’s proposition in this space?

We offer bespoke development finance solutions on a first charge basis to experienced developers for a range of development types, including permitted development schemes and group developments of single and multiple units. Our lending is available to individuals, SPVs and limited companies that require up to 70% gross development value (GDV) on day one. Loan sizes are available from £1m to £10m and terms are available between nine and 30 months. 

An important part of our proposition is that every case is supported by a dedicated team for the full term of the loan, with Castle Trust on hand to provide expertise throughout the build.

What questions do you ask developers on application?

On every development finance case, we will ask three simple questions. Has the developer completed at least two similar schemes in the past? Does the developer have cash in the deal? And is BTL a realistic exit for the development? If the answer to all three of these is yes, then we are keen to develop the conversation.

Can you give some interesting examples of the types of schemes you have worked on?

A couple spring to mind. The first is a client who was a very experienced developer who had recently completed a 106-unit apartment scheme in Leeds. They subsequently secured planning permission for the demolition and rebuilding of a working men's club in a suburb four miles from Leeds city centre for the construction of 54 new luxury one- and two-bedroom apartments. As the client had a strong development background, we were able to advance a £6m loan, based on a GDV of £9m over a term of 18 months. The build remains on track for completion and is expected to be delivered at the same high standard that the client has achieved on previous schemes.

Another example is where we worked with a developer to provide a facility for the refinancing of a development site in Plymouth, which included the demolition of a vacant 40-bedroom council care home facility and the subsequent construction of a seven-storey, 76-unit apartment building. This was a large project, with a GDV of £16m and a required loan size of £12m, but as the client was an established developer with a proven track record in construction and property development, we were able to provide the senior debt on a 24-month term, applying a pragmatic approach which has helped to propel this project forward.

You joined Castle Trust after holding senior roles elsewhere in the industry. Why did you choose to join the lender? 

It’s clear that Castle Trust has a real appetite to lend and to build long-term partnerships with developers and intermediaries — so that is always appealing. However, more than that, I was excited about the prospects for Castle Trust as a wider business. Its BTL and bridging lending propositions are well respected throughout the industry, and the plans for a banking licence will create a diverse and exciting business. There’s a great atmosphere about the place and everybody feels that we are on the brink of some great opportunities for the future.

How did you get into the industry? 

I have worked in banking for much of my working life, financing a range of asset classes from roads, to rail to shopping centres. Throughout this, I have done a lot of property lending and I’ve found it a diverse and interesting space in which to be involved, so I focused my career in this area and have worked in residential development for the past five to 10 years.

If you weren’t in finance, what would you be doing? 

I would love to be a travel writer or a restaurant critic.

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