Backing Ambitious Property Developers Crucial for Solving Housing Crisis, says GIC Capital
The housing crisis is putting pressure on young families and while the issue was addressed in Philip Hammond’s budget, the government still isn’t going far enough, according to experts GIC Capital.
The industry needs to back and invest in forward thinking property developers to really tackle the crisis and ensure that aspiring homeowners have access to affordable options, the lending insider explains.
The government has set out plans to build 300,000 new homes a year but with past targets being missed, there’s uncertainty as to how well the new goals will be followed through. The shortage in housing is contributing to the highly competitive property market and spiralling values, pricing many Brits out of the market altogether. While noting there’s no single move that can correct the housing crisis, GIC Capital is taking steps to boost the market by offering a means to inject funds, allowing developers to carry out their plans through its 100% Development Capital service.
Kennedy Zvenyika, Managing Director of GIC Capital, said, “We’re encouraged to see that housing is remaining on the government’s agenda but so far plans are having only a limited impact. There are property developers across the country that are eager to launch their developments to provide more options to those searching for their next home. We connect these developers to investors that want to take advantage of the growing values, supporting the economy and those involved in the projects.”
Acting as a facilitator, GIC Capital helps property and land development plans get off the ground by connecting developers with partnerships that can offer 100% of the funding needed. Through carefully selecting both experienced residential property developers and reliable investors, GIC Capital hopes to provide the capital needed to fund greater levels of affordable home building across the UK.
The terms of the 100% Development Capital service can vary but typically developers will retain 60% of the profits generated, while investors share the remaining 40%. At a time when access to capital and interest rates are both tight, it offers a lucrative option for both parties thanks to the exceptional margins in the property sector.
Zvenyika added, “We’re keen to work with developers that are creative and passionate about what they do. Whether they have a vision to create a new multi-unit block of residential flats or are planning to tackle a conversion project, we’re always looking for ways that we can offer support.”
To find out more visit giccapital.co.uk.