Inputs
- Units: 9 apartments (mix of 1B1B and 2B1B).
- GIA per unit: 850 sqft. NIA: 85 percent (722.5 sqft saleable each).
- GDV: 9 x 722.5 x 360 = £2,340,900. Round 2.34m.
- Build: 9 x 850 sqft = 7,650 sqft GIA = 710.7 sqm. 710.7 x 2,300 = £1,634,610 build cost.
Residual ledger
GDV | £2,340,900 |
Build cost | (£1,634,610) |
Professional fees (12% of build) | (£196,153) |
s106 / CIL / BNG (9 x 4,000)(small-sites CIL relief partial) | (£36,000) |
Contingency (7.5%) | (£140,007) |
Finance interest (S-curve, 9.5%, 18 months, 50% avg) | (£143,213) |
Subtotal costs | (£2,149,983) |
Target profit (20% PoC) | (£429,997) |
Residual before SDLT gross-up (GDV - costs - profit) | (£239,080) |
Residual NEGATIVE before tax: deal aborts at 20% PoC | |
Recompute at 15% PoC: profit = 322,497 | |
Residual at 15% PoC | (£131,580) |
Still negative. Need GDV uplift or cost discipline. | |
| Verdict at NW mid | ABORT (negative residual) |
The lever that flips this
Push GDV to £410/sqft (NW high band, achievable on Ancoats prime). New GDV 2,663m. Costs unchanged. Residual at 20 percent PoC: roughly 80k positive. Still thin. Push build cost down to £2,100/sqm (NW low) instead: build 1.49m, costs 1.95m, residual at 20 percent PoC 175k. Better.
Senior debt sizing
If the deal pencils: senior at 65 percent LTGDV = 1.520m. Total project cost at 175k land = 2.13m. LTC = 71 percent. Senior LTGDV binds first. Equity gap = 2.13m - 1.52m = 610k.