Alternative lender Castlehaven Finance is to put €350m in development and bridging finance into the housing market next year as it expands into Cork, Galway and Limerick, which it hopes will finance construction of more than 2,500 residential units in Dublin, Cork, Galway and Limerick.
The homes will be a mix of private and social housing, and the finance package is backed by PSC Eaglewood, part of the Pollen Street Capital Group with over £2 billion of assets under management. Castlehaven is on track to complete over €150m in lending this year, providing over 1,000 residential units.
Castlehaven is an alternate lender targeting developers and builders and provides acquisition financing, working capital finance and re-financing up to 90% of total costs. Castlehaven also provides bridging finance with a ‘Loan to Value’ of up to 80%. With loan sizes from €1m – €20m, Castlehaven acts as an alternative to banks as a source of funding.
Castlehaven partner Will Aylmer said: “We have seen a large increase in activity in the Irish residential property market over the last 12 months, in particular the demand for new housing in Cork, Galway and Limerick. In response to this we are now actively seeking lending opportunities in these locations.
“One of Castlehaven’s key selling points is that we are very responsive and have a fast decision-making process. The financing of a recent development project was completed in seven days, start to finish. This speed gives us and our clients a huge advantage in the market.
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“In addition we can provide equity releases to developers that have already purchased sites with their own resources. Our charges are transparent as we simply charge fees and interest on drawn funds. We do not charge profit shares or have exit fees based on gross development value. Our pricing varies, depending on risk.”
Castlehaven will look at all residential proposals types, funding both housing and apartment schemes, including social housing. The company has already provided financing to complete over 200 social housing units in Dublin, Meath and Louth.
Aylmer believes his firm offers a faster route than the new Home Building Finance Ireland state body set up to lend to house builders. He added: “This body will take some time to set up, yet there is an immediate demand which we are currently fulfilling and will continue to do so. Interestingly, from what we know, the new entity will only lend against sites already in ownership and more specifically only provide finance for construction.
“I’m not sure how attractive this will be to developers, especially when we are already providing equity releases to developers on sites already in ownership. Delivery of funds within a quick timeframe — and flexibility — are more important to our clients than a slight variance in rate.”
Photo: Will Aylmer (left) with Chris Curtis and Stephen McManmon (right), director of Quarry Road Developments
