Global Family Office Community speak to D’mitri Zaprzala, CEO

What can you tell me about Avamore Capital?

Our co-founders, Michael Dean and Zuhair Mirza, formally launched Avamore Capital back in 2015. At the time, following the global financial crisis, they realised there was a gap in the market for property development and bridging lending as large swathes of the market were underserved, particularly in the SME development space. Since then, the business has grown rapidly to become one of the most established names in SME development finance. We’ve secured institutional funding from two US credit funds and built a platform which has now lent over £500m since inception with goals to exceed over £1bn in the next two years. 

We are a principal development and bridging lender operating in England and Wales, issuing loans between £250K to £15M across four key products; Development, Refurbishment, Bridging and Part Complete Development. 

We are a credit focused lender, and we take the management of our investor’s money extremely seriously. Whilst we can be flexible and creative with the solutions that we provide we are always focused on the credit quality of each transaction; it is the cornerstone of our DNA. The combination of good credit, exemplary loss record and profile in the market make us an excellent partner for both investors, and borrowers. 

When and how did you come to join Avamore Capital? What attracted you to it?

I joined Avamore Capital in October 2021, leaving my previous role as Head of Residential at Octopus Real Estate. I had known both the Avamore business, and the co-founders personally for several years, so when we started talking about the opportunity it immediately excited me. It was very much an established brand in the market, famed for its service and lending in areas of specialism with a dynamic team. The opportunity to be part of the future growth and success of the business motivated me to make the move and nearly two years on it was absolutely the right decision.

How’s your experience been managing a company in the current UK climate? What challenges have you faced?

If there’s anything the last few years have shown, it’s to always expect a challenge. In 2022 alone we saw numerous Prime Ministers and Chancellors alongside a new monarch and a war in Europe. It was a year of rampant inflation and rapid rate increases and while the overall turbulence of the year left the market fragmented, it also presented a significant opportunity for continued growth like what the business has experienced to date. The growth in the underlying market is underpinned by a significantly reduced appetite from banks to lend in the sector and now more than ever is where specialist lenders like us tend to thrive. Our support is there for when high street, challenger and clearing banks can’t deliver suitable solutions to borrowers and, while some of our competitors began to suffer from funding constraints, we are in a position of strength. It has been both challenging and rewarding in equal measure.

What further challenges do you expect for this year?

As we head further into 2023, I believe the impact of the challenges we have faced will continue. I think we can expect more clarity around interest rates and inflation, especially in the second half of this year however it would be fair to assume that this won’t be quick. We can expect a drawn-out slowdown in activity and from that, the biggest challenge will be the lethargy it creates in the market. It will take us a bit of time to get there, but I think once we do it will be quite a soft landing. As we move into an election year in 2024 I’d expect the political landscape to be (relatively) benign for the next few months but very quickly move back to the top of the agenda as we approach the new year. 

What positives do you foresee on the horizon?

There is a lot of negative news around where house prices will go this year, however much of it is to grab eyeballs and headlines. Our view is that yes potentially there will be a small reduction in prices but there are already some market predictions that they may not fall as steeply as expected. For Avamore, we see further opportunities to expand our lending strategy into adjacent lending sectors that existing incumbents move away from or aren’t willing to back. For example, the development of student housing has experienced rapid growth for a number of years, but the requirements are changing. Being able to quickly pivot to new lending areas is a huge positive for us. 

The undersupply of property isn’t going away and with that, the need for funding won’t be going away either. It’s in this period where remaining focused on why we exist is important. We remain strong in a difficult market thanks our proactive and forward-thinking mindset and internal forecasts factoring seasonal trends predict another strong year for us in 2023.