Uma Rajah

The renewed interest in greener areas 'is not to the detriment of London', says CapitalRise CEO



In an exclusive interview with Development Finance Today, Uma Rajah, CEO and co-founder of CapitalRise (pictured above), believes that the prime property market continues to be seen as a “safe haven” with “relatively good value on a global scale” for investors.


The lender, which specialises in funding the prime property market, saw a 90% increase in new enquiries since the beginning of lockdown in March 2020, and provided finance for assets worth almost £120m GDV in prime areas of London and the Home Counties last year.

“All previous market cycles have seen the recovery phase start in prime central London — the underlying lack of supply means it bounces back quicker than other parts of the UK property market, and we would expect to see this again,” she claimed.

She expects that the renewed interest in greener locations will not be to the detriment of London. 

“While buyers may wish to have a property in leafy Surrey or Hampshire, a home in the capital is still very much desired, but developers are aware of the impact of outside space, be that a private terrace or, better still, a garden.”  

DFT recently caught up with Uma to find out her views on how the prime property market will fare this year following the Covid-19 effects and Brexit. Read the full interview, below.

CapitalRise recently secured a £72m institutional funding line. How will this boost your development lending appetite, and do you have plans for further funding lines this year?

The new facility enables the continued acceleration of the company’s loan book growth and to serve more developers in the prime property market. The value of assets CapitalRise has lent against has now surpassed £456m with no capital losses. Our new partnership gives us the ability to provide a broader offering and develop a stronger presence in the market. 2020 was a fantastic year for CapitalRise, and we are incredibly proud of our achievements. We are extremely excited about 2021, particularly with this additional funding capability.

We have just entered a third national lockdown. While the property market remains open, what challenges do you foresee?

Since the beginning of lockdown in March 2020, when many lenders withdrew funding lines, CapitalRise saw a 90% increase in new enquiries — despite the ongoing pandemic.

In 2020, CapitalRise funded assets with almost £120m GDV in prime areas of London and the Home Counties.  The prime property market, within which CapitalRise operates, has always proven to be the most resilient part of the UK property sector. While we expect an impact on all areas of the property market, we expect the prime property market to bounce back significantly faster.

How have the lockdowns, socially-distanced precautions onsite, and the new Brexit deal impacted the development market so far, and what problems do you expect this year as a result?

Regardless of the macro-environment, we are always realistic to the challenges of property development, and, as such, we always build in healthy contingencies both for term of programme and forecast costs. As a result, to date, we have been able to support our borrowers throughout the ongoing pandemic and impacts of Brexit, which have, on occasion, caused issues with labour and delays/rising costs of materials. All the development sites we are funding have remained open throughout the various lockdowns and works continue to progress well. It is worth noting that areas such as Mayfair and Belgravia in prime central London are impossible to replicate elsewhere. Prime central property is seen as a safe haven and relatively good value on a global scale. Despite Brexit and Covid-19, we have seen double digit growth in our loan book while maintaining our track record of zero losses. We screened over £5bn of deals in the past 12 months, with over 93% derived from the relationships we have with our hugely supportive broker network.

CapitalRise operates in the super prime property market. How have you been able to mitigate risk when lending in this area during the pandemic?

At CapitalRise, we have always prided ourselves on the level of due diligence we undertake at the outset of any deal. Being able to combine our founders’ exceptional knowledge of the prime property markets as developers in their own right with the detailed borrower due diligence, financial analysis and stress-testing we undertake, continues to hold us in good stead. CapitalRise has its fifth anniversary of trading in 2021; to have had zero losses since we opened our doors, is something that we are very proud of. We are committed to lend throughout these challenging times, and our unwavering stance on due diligence remains evermore important to our continued success.


With suburban property becoming somewhat of a trend since the onset of the Covid-19 crisis, do you expect there will be a reduction in city-centre living and working going forward? What opportunities and challenges do you see in the PCL market in 2021 as a result?

All previous market cycles have seen the recovery phase start in prime central London — the underlying lack of supply means it bounces back quicker than other parts of the UK property market, and we would expect to see this again. This is underpinned by the global demand for this asset class; and so long as wealth is being created somewhere on the globe, markets such as prime central London will benefit. It is a safe haven for global investors and subject to different dynamics to the mainstream UK property market.

CapitalRise has also seen an increase in enquiries for funding in the prime Home Counties. The importance of private outside space, and more room for say, a home office, family room or gym, when combined with the realisation that going, forward, people may only go into the office a few times a week, is clearly changing people’s current mindsets.   

What does the refinance landscape look like in terms of competition and offering in the prime property market?

Our team’s deep knowledge of the market enables us to review the merits of each project on a case-by-case basis, with an understanding that no two properties in the prime space are equal. Our ability to deliver bespoke finance solutions to our customers is a niche market, as we find that many lenders take a blanket view of prime and are unable to offer finance, for example against high-value single assets with high pound-per-square-foot values.

What sort of demand, in terms of asset, finance type and area are you seeing from property developers at the moment and why?

It is evident that demand for alternative sources of finance is continuing to grow in popularity. Mainstream lenders are falling short in terms of the agility and speed that is required by developers seeking finance.

We are seeing an increased volume of demand for residential single dwellings, highlighting the intense demand for larger houses that has been an unexpected but sustained result of the global pandemic. The appetite among buyers for large houses has soared as people found themselves re-evaluating their property priorities after spending extended periods of time at home during lockdown. As a result, many buyers’ priorities have changed, with an increased desire for green spaces and home offices.

However, this renewed interest in greener areas is not to the detriment of London. While buyers may wish to have a property in leafy Surrey or Hampshire, a home in the capital is still very much desired, but developers are aware of the impact of outside space, be that a private terrace or, better still, a garden. Outside space may not significantly increase the value of the property, but it will increase its marketability, which is critical to developers whose livelihoods are dependent on being able to sell completed developments in a timely manner.

We are seeing this translate into increased demand for all our products — ie for both senior and mezzanine debt finance across bridging, development and sales period loans — as well as across all the geographic sectors that we focus on, from prime central London to the prime Home Counties.

What advice would you give to developers and development brokers that are looking for prime property development finance?

Tailored funding solutions, speedy response times, flexible payment options and a trustworthy finance provider throughout the project’s lifecycle are important factors that should be considered. It is not for the faint hearted, so be realistic! It is vital that property developers continue to address the ongoing challenges of the pandemic in their business plans.

Currently, building works are taking more time than usual due to increased delivery times and demands on the labour force, so cost overruns and unexpected delays are likely to continue rising. This is coupled with uncertainty on valuation levels and caution around high leverage. Property developers need to be true and honest to actual property values and stress-test the viability of projects to ensure they generate sound returns; they should also seek out lenders that understand prime property development and its complexity.

What are CapitalRise’s main goals and ambitions for this year?

We would like to accelerate our loan book growth and also continue to be recognised as the go-to lender for funding prime properties in prime locations. Our combined long experience of this niche asset class gives us a unique set of tools, enabling us to deliver leading funding solutions.

Building better and greener was a theme from the government and the general public last year. How will you be encouraging and innovating to meet these demands?

We are fully supportive of the government’s plans for a green industrial revolution. We are continually monitoring the technological advancements in the building industry, particularly in terms of materials, smarter ways of building, and improving energy efficiency within buildings and sustainable resources. We will support green buildings and developments where we feasibly can.

How do you think the development finance sector will evolve in 2021?

For our sector, the move away from traditional sources of lending, such as banks, is a given. We will continue to see players move in, as well as out of this market, however the need for new housing is greater than ever, so there is space for all of us, in our various niches, price points, and risk appetite.



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