How does commercial property development finance actually work in 2026, and who funds what? Georgina walks through it in plain English, with real numbers and a worked example.

What is covered:
- What commercial property development finance is, and how staged drawdowns work
- The 2026 backdrop with the Bank of England base rate held at 3.75%
- How a lender sizes a loan on loan to cost (65 to 70% of cost) and loan to GDV (60 to 65% of value), and why the facility is the lower of the two
- The worked example: a 3m GDV scheme on 2.2m of cost gives a maximum senior facility of 1.54m, with the gap as day one equity
- The leverage ladder: senior 65 to 70%, stretched senior 75 to 80%, senior plus mezzanine 85 to 90%, JV equity up to 100% of cost
- Development exit finance: a cheaper bridge at practical completion, LTV up to 70 to 75%, term 6 to 18 months
- Permitted development finance and why the planning position has to be sound first
- Where rates sit: senior development finance around 9 to 12% a year, arrangement fee around 1 to 2%, and the generic lender camps

Guides behind this episode:
Commercial Property Development Finance 2026 outlook
Commercial Property Development Exit Finance
Senior development finance
Stretched senior development finance
Mezzanine finance for property development
JV equity for property development
Permitted development finance
Development finance rates

Talk to us: https://www.commercialpropertydevelopmentfinance.co.uk/

Written guides authored by Matt Lenzie.

Sources: Bank of England (base rate); the money site's published indicative market bands.

Disclaimer: We are an arranger and introducer of finance, not a lender, and we are not authorised by the Financial Conduct Authority. This is general market commentary on unregulated commercial lending. Figures are indicative only and nothing here is an offer or advice.