Private capital’s growing role in development finance

As banks continue to limit their exposure to speculative development, private capital is stepping into the gap. Family offices, private equity funds, and high-net-worth investors are increasingly backing specialist platforms who can deploy funds quickly and structure loans around complex requirements.

The appeal is obvious. For providers, returns of 8–12 percent per annum are attractive in a low-yield environment. For developers, the ability to secure up to 90 percent loan-to-cost with faster credit approval can make the difference between winning a site and losing it.

Specialist finance firms also tend to understand the realities of development better than clearing banks. They are often led by professionals who can assess risk with a commercial eye and adapt structures accordingly.

The challenge, however, is consistency. Not all providers have deep enough capital pools to support larger schemes or to weather market shocks. Developers should always diligence their funding partners, ensuring they are backed by reliable investors with the capacity to see a deal through. Nonetheless, the trend is clear: private capital is no longer the last resort, but often the first call for ambitious developers. Imperial Blue Finance provides development loans that bridge the gap between equity and traditional debt, supporting schemes that banks often cannot.