Most schemes can be funded several different ways. The right structure depends on how much equity you want to commit, how fast you need to move, and what your exit looks like.
Senior debt
The first-charge facility that funds land and build, typically to around 65–70% of total cost or 55–60% of GDV. Cheapest capital in the stack, most conservative covenants, and the most scrutiny on cost and valuation evidence.
Best for developers with meaningful equity, a clean track record and a straightforward site.
Stretch senior
A single first-charge facility taken to a higher loan-to-cost — often 80–85% — priced somewhere between senior and mezzanine. One lender, one legal process, one monitoring regime.
Best when you want higher leverage without the complexity and intercreditor negotiation of a second lender.
Mezzanine
Second-charge or structurally subordinated capital that sits behind senior debt and takes you to a similar overall leverage as stretch senior. More expensive, sometimes with a profit share, but flexible on how it is deployed.
Best when your senior lender is competitively priced but capped, or when you are recycling equity across several sites at once.
Equity, joint ventures and private capital
Private banks and high-net-worth investors will often look at structures institutional lenders will not — unusual assets, part-complete schemes, or a genuine profit-share JV where you contribute the site and expertise.
The trade-off is cost of capital versus how much of your own money is tied up. Model return on equity, not just the interest rate.
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