Developer Exit Loans: What They Are and Why You Might Need One

In property development, timing is everything. You have finished the build, the units are nearly sold, but the original loan is coming to an end. Suddenly, the pressure is on. That is exactly where a developer exit loan can give you breathing space and flexibility.

Exit finance allows you to repay your development loan once the build is complete, often before all the units have been sold. It is a way of reducing costs, managing cash flow, and avoiding the penalties or risks of overstaying your original facility.

At Otium Partners, we help developers transition smoothly from one stage of funding to the next and developer exit loans are one of the tools we use to make that happen.

What Is a Developer Exit Loan?

A developer exit loan is a short-term facility used to repay an existing development loan once construction is complete. It is typically secured against the finished property and used to:

· Extend the sales period and avoid forced selling

· Reduce the cost of borrowing compared to the original development finance

· Release equity for the next project

· Remove pressure from lenders who may want repayment quickly

The key benefit is flexibility. Rather than being forced into decisions by a looming loan expiry, you gain time to sell units, complete sales, or refinance into longer-term borrowing.

When Does It Make Sense to Use Exit Finance?

Developer exit loans are especially useful when:

· Sales are underway but not fully complete

· The original development loan is nearing maturity

· You want to access better rates now that the project is de-risked

· You are looking to release capital for your next scheme

They can also improve your relationship with your original lender by avoiding late repayments or renegotiations. In a market where lender confidence matters, that is no small thing.

How Otium Helps Developers Stay in Control

At Otium, we work with specialist lenders who understand the needs of developers at every stage. With a strong exit plan in place, we can often negotiate lower rates and more flexible terms than you might expect.

We support you by:

· Preparing the case with clear evidence of value and sales progress

· Identifying lenders who move quickly and understand development exit risk

· Managing all timelines, documentation, and communication on your behalf

· Helping you align this funding with your next step, whether that is sales or a refinance

Our aim is not just to secure funding. It is to help you move forward strategically.

Real Deal: From Construction to Control

One of our clients was nearing completion on a scheme of 22 new homes. The development had gone well, with several units sold off-plan and more interest coming in, but the original £4.5 million development loan was reaching the end of its term.

Rather than rush to complete sales or extend the original facility under pressure, we arranged a developer exit loan with a new lender. This allowed the client to repay their development lender, reduce their interest costs, and take control of the sales timeline.

Within nine months, the client had completed sales on all units — and was already planning their next project.

Is a Developer Exit Loan Right for You?

If your build is complete but you need time to realise its value, a developer exit loan could be the right move. It gives you time, flexibility, and in many cases, a lower cost of borrowing.

Otium Partners can guide you through the process from start to finish. We will help you assess your options, structure your case, and manage the full journey on your behalf.

Call Jeff on 07872 601662 or email us at pa@otiumpartners.com to find out how we can support your next move.