How to Raise 100% Development Finance (And When It Works):

Raising development finance is often one of the biggest hurdles property developers face when looking to grow their portfolio or take on larger projects.

Traditionally, lenders expect developers to contribute a meaningful amount of their own capital, particularly towards the purchase of a site. However, in certain scenarios, it is possible to secure 100% development finance, covering both the acquisition and build costs.

This raises an important question: is 100% development finance realistic, and when does it actually work?

What is 100% Development Finance?

In simple terms, 100% development finance means a lender funds the full purchase price of the site and the entire build or refurbishment cost.

This removes the need for the developer to inject cash into the project upfront.

However, it is important to understand that this does not mean “no security”. It simply means the structure is supported in a different way.

How Lenders Are Able to Offer 100% Funding

To provide this level of funding, lenders typically rely on one or more of the following:

1. Additional Property Security

This is the most common structure. A developer offers equity in other properties, land or assets owned outright or with low leverage. This allows the lender to remain within their risk parameters, for example 70% to 75% LTGDV, across the overall security package.

2. Strong Project Fundamentals

Even with additional security, lenders will look closely at the strength of the site, planning status, GDV versus cost, and the proposed exit strategy. A well-structured deal significantly increases the likelihood of achieving 100% funding.

3. Experienced Developer Track Record

Developers with proven delivery history, strong cost control and reliable exits are far more likely to secure higher leverage.

When 100% Development Finance Works Best

While attractive, 100% funding is not suitable for every deal. It tends to work best in the following scenarios:

1. Asset-Rich Developers

Developers who own other property with meaningful equity and want to preserve liquidity can use existing assets to unlock funding without selling or refinancing them outright.

2. Time-Sensitive Acquisitions

In competitive markets, being able to move quickly, offer certainty and avoid funding delays can be the difference between securing or losing a site. 100% funding allows developers to act decisively.

3. Portfolio Growth Strategies

Developers looking to scale often prefer to recycle capital and retain cash reserves rather than tying up funds in each new project.

4. Bridging into Development

In some cases, developers use bridging finance initially before transitioning into a development facility, with the overall structure still achieving close to 100% funding.

The Benefits of 100% Development Finance

1) Preserves Cash Flow

Developers can retain capital for contingencies, new opportunities and wider business operations.

2) Enables Faster Growth

Access to higher leverage allows developers to take on more projects and scale their pipeline more efficiently.

3) Stronger Negotiating Position

Being able to fund a purchase without delays can strengthen offers and improve deal terms.

What Lenders Look For

To secure 100% development finance, developers should be prepared to demonstrate:

· A clear and credible exit strategy

· Realistic build costs and timelines

· Strong supporting security

· Relevant development experience

How Onyx Supports 100% Development Finance

At Onyx, we regularly structure development finance facilities that can fund up to 100% of project costs, where supported by additional property security.

This approach works particularly well for asset-rich developers, time-sensitive acquisitions, and projects where preserving liquidity is key.

We combine flexible funding structures with in-house legal and monitoring capabilities, allowing us to move quickly and maintain control throughout the process.

Final Thoughts

100% development finance is not about removing risk. It is about structuring it correctly.

For the right developer, with the right assets and the right project, it can be a powerful tool to unlock opportunities, accelerate growth and improve efficiency.

However, it requires careful planning, disciplined execution and the right funding partner.