Development Exit Finance Rates September 2026 — Bridge After Practical Completion
- Development exit bridge rate range/month (September 2026)
- 0.75%–1.10%Development exit bridge rate range/month (September 2026)
- Exit bridge typically cheaper than extending development finance
- Lower than dev loanExit bridge typically cheaper than extending development finance
- Maximum LTV of completed development value — typical for exit bridges
- 65%–70%Maximum LTV of completed development value — typical for exit bridges
- Typical exit bridge term — while sales programme completes
- 3–18 monthsTypical exit bridge term — while sales programme completes
Development exit finance rates in September 2026 range from 0.75%/month to 1.10%/month depending on LTV (of completed units' value) and the developer's track record. A development exit bridge is used after practical completion when the development loan needs to be repaid before all units have sold. The exit bridge replaces the higher-cost development loan (typically 0.85%–1.30%/month on most senior debt facilities) with cheaper exit finance at lower rates — allowing more time for sales without incurring the cost of extending the development facility.
Development Exit Bridge Rates vs Extending Development Loan — September 2026
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| Option | Rate | Arrangement cost | Typical term | Best for |
|---|---|---|---|---|
| Development exit bridge | 0.75%–1.10%/month | 1%–2% (new facility) | 3–18 months | Developers who have completed and need sales time without dev loan cost |
| Extend development finance | 0.90%–1.30%/month (dev loan rates) | 0.5%–1% extension fee | Extension 3–12 months | Where exit bridge would trigger a break fee or where units are selling quickly |
| Retain development loan to last unit sold | Dev loan rate throughout | No additional cost beyond running rate | Full sales period | Rarely optimal — dev loans are priced for build risk, not sales period |
| Portfolio BTL refinance (all units let) | BTL rates 5.0%–5.65% | Standard BTL arrangement | 2–5yr fix | Developer retaining all units as BTL — converts to long-term finance |
What determines your rate
Why exit bridging is cheaper than extending the development loan
Development loans are priced to reflect build risk — the risk that the development does not complete, or completes at a lower quality or value than planned. After practical completion, the build risk is gone: the units exist, are valued, and are selling. An exit bridge is secured against completed, marketable residential or commercial units — lower risk than a development in progress. Lower risk = lower rate. The saving versus a development loan extension is typically 0.10%–0.40%/month — material over a 6–12 month sales period.
LTV calculation for development exit bridges
Exit bridge LTV is assessed against the Gross Development Value (GDV) of completed units as independently valued at practical completion. Most exit bridge lenders cap at 65%–70% of GDV. If the completed development has already sold some units, the exit bridge is typically secured against the remaining unsold units (or the whole completed development), sized at 65%–70% of the unsold units' value. DBF calculates the maximum available exit bridge facility based on the specific sales programme.
Break costs from development loans
Before arranging a development exit bridge, check whether the development loan carries a break fee for early repayment. Some development lenders charge 1%–2% of the outstanding facility as an early repayment charge. If the break cost exceeds the saving from cheaper exit bridge rates, it may be more cost-effective to extend the development facility instead. DBF models this comparison as the first step in every development exit enquiry.
Exit bridge timing — practical completion is the trigger
Development exit bridges are typically available from the date of practical completion — the point at which a qualified professional certifies the development is complete enough for occupation. Some lenders will advance exit finance in advance of practical completion where it is imminent (typically within 4 weeks). DBF advises on the optimal timing to apply for an exit bridge relative to the practical completion date.
Worked cost example
- Total
- £97,500
- Exit bridge
- 70% of £1.2m remaining units = £840,000
- Total
- £55,440
- Development exit bridge saves
- £97,500 - £55,440 = £42,060 over 6 months
Development: 8 residential units, Sheffield. GDV: £2.4m. Practical completion: August 2026.
Development loan outstanding: £1.56m at 1.10%/month (LendInvest). Arrangement fee paid.
4 units sold at completion. 4 units remaining: value £1.2m.
Option A — Extend development loan (6 months extension)
Extension fee (0.75%): £11,700. Interest at 1.10%/month: £85,800 over 6 months.
Option B — Development exit bridge (6 months)
LendInvest development loan repaid from exit bridge + sales proceeds.
Remaining £1.56m - £840,000 exit bridge - £720,000 sales proceeds = fully repaid.
Exit bridge rate: 0.85%/month. Interest: £42,840. Arrangement fee (1.5%): £12,600.
All 4 remaining units sell in month 5. Bridge redeemed at month 5.
Actual cost (5 months): £35,700 + £12,600 = £48,300. Saving vs extension: £49,200.
Rate context and outlook
The Bank of England held its base rate at 3.75% on 30 July 2026 in a divided 6-3 vote. Three MPC members voted to raise to 4.0%. Next decision: 17 September 2026. DBF has arranged development exit bridges for developers across the UK, including the Sheffield case study above. Exit bridge lenders active in September 2026 include Octane Capital, LendInvest, Roma Finance, and specialist development exit lenders. DBF also advises on whether extending the development loan or taking an exit bridge provides better total cost — this comparison is always done before recommending.
Frequently asked questions
What is a development exit bridge?
A short-term bridging loan secured against completed residential or commercial units, used to repay a development loan when the development has reached practical completion but not all units have yet sold. Exit bridges are typically cheaper than extending a development loan and give the developer more time to achieve full sales value without pressure from the development lender.
What are development exit bridge rates in September 2026?
Development exit bridge rates range from 0.75%/month for prime residential developments with experienced developers at 60%–65% LTV of completed value, to 1.10%/month for commercial or mixed-use developments at 65%–70% LTGDV. Arrangement fees are typically 1%–2% of the exit facility.
Is it cheaper to take a development exit bridge or extend the development loan?
Usually a development exit bridge is cheaper — development loans are priced for build risk (0.90%–1.30%/month), while exit bridges are priced for completed property risk (0.75%–1.10%/month). The saving is typically 0.10%–0.40%/month. However, early repayment charges on the development loan must be factored in. DBF models both options before recommending.
How much can I borrow on a development exit bridge?
Most exit bridge lenders advance 65%–70% of the GDV (gross development value) of the completed units being used as security. If the development has already sold some units, the bridge is typically sized against the remaining unsold units. DBF calculates the maximum available facility based on the sales programme and current unit valuations.
When can I take a development exit bridge?
From the date of practical completion, or in some cases up to 4 weeks before practical completion where it is imminent. DBF advises on the optimal timing based on the specific lender's requirements and the development programme.
Get a personalised rate comparison for your case
Independent whole-of-market advice · FCA No. 814533