Hilltop Credit Partners continues to fund residential property developers despite pandemic uncertainty

Paul Oberschneider

Hilltop Credit Partners, a specialist funding partner for small and mid-sized residential property developers and housebuilders, is committed to supporting SME developers in the UK and have announced plans to disburse over £75 million in the coming months.

The announcement comes at a time when the property market is rife with uncertainty and fears around the pandemic, but the West End-based fund remains focused on funding high-quality assets and developers.

Paul Oberschneider, Founder and CEO of Hilltop Credit Partners, comments: “The world economy is suffering a severe downturn, probably worse than the 2008 crisis and unmatched by anything in history aside from the Great Depression. In the pre-pandemic months, the housing market was exhibiting a very strong underlying momentum in wake of the decisive general election results, with a sharp uptick in sales and price growth across the UK.

“An industry report also showed how the number of sales agreed in four weeks up to early March were up by an astounding 17.8 percent — the highest at this time of year since 2016. However, the pandemic and the ongoing lockdown has put this recovery on hold, with sharp near-term reductions in activity expected.

“Not surprisingly, real-estate lenders have adopted a bearish attitude and are pulling back from the market. This situation is set to widen the funding gap in the market and further aggravate the housing crisis in the UK. To put the record straight: Shortage of affordable housing will continue, and lenders should treat this shift as an opportunity to continue supporting developers with a strong downside protection. Market uncertainty is real, but lenders must not forget that the real-estate sector is neither the cause nor the centre of the problem.

“At Hilltop Credit Partners, we undertake a robust credit analysis of the project and are not hemmed in by non-performing assets which can be a drag on books. Our objective remains unchanged – to support residential property developers and whilst we have tightened our underwriting criteria to account for the market uncertainty, we see no reason to recede. We are continuing to fund and are poised to disburse over £75 million in the coming months.”

Hilltop Credit Partners recently completed a £13.6m loan to Pascoe Property Developers Limited for a residential development in Ashford, Kent.

The loan will be used for the site acquisition and ground-up development of 98 residential units in three phases, and all units will qualify for the Help to Buy scheme.