Investigating Residential Bridging

Marwan Field is Co-Founder and CEO at Byoot. His impressive portfolio consists of HMO conversions, extensions and housing developments. Marwan worked with Avamore on a residential bridge last year and now he is sharing his experience with us.

Why have you used a residential bridge? What were the other options which you considered? 

I went for a residential bridge, partly because it was something I hadn’t done before. Previously, I’d used equity from my existing portfolio, but I knew that I wanted to try out using bridge financing at some point instead. I needed to make a small transaction and so, it seemed like a good opportunity to go down that route. The timing worked well, I came across Avamore’s Instagram and built the connection through there!

What is the biggest lesson you have learnt from your projects?  

I think it is key to not underestimate the length of time a project will take. When you are working with third parties, it is difficult to manage your own time and make sure that everyone else is doing what they’d agreed to in the set time frame. I’ve found that despite making promises at the start, there are so many factors and people involved that there will inevitably be delays.

The general rule that I use is if you are subcontracting work out and not using a team which you have a relationship with, double the length of estimated time. It means that you won’t be disappointed, and you set your project up with realistic expectations.

A key piece of advice is that when you are looking to use third parties, try and employ a total solution; a company that can provide you the building along with all of the intricacies like plumbing and electricity is great, that way people are more likely to work together to get the job done.

What is the advantage of using a residential bridge?

In all honesty, taking out a bridge wasn’t as quick as I had envisaged. It was however great in my case that I got to deal directly with the decision makers, so I knew exactly what was going on. I have realised that when you opt for a bridge rather than going for a high street product, it’s more about building a relationship. Banks plug numbers into their system but with Avamore, it wasn’t so systematic. There is a shared interest for success and a willingness to be flexible. That’s the key advantage.

How does your current project compare to other?

My bridge project is fairly similar to previous work I have done. I tend to stick to schemes where I can add value from a development perspective, HMOs are generally what I work on.


Were there any difficulties with taking out your residential bridge?

There were no major difficulties with the bridge. As I mentioned, I dealt directly with the credit team so there were no nasty surprises, everything was pretty transparent. I had some difficulty repaying but Avamore were great when it came to that. They were understanding and accommodating and helped me work out the best solution. They could have implemented major penalties, but their conduct was truly impressive, it definitely felt much more like a partnership.

A point I would make though is that in the digital age, processes could be made much easier and more efficient. There is a lot of paperwork and a number of different parties involved. I think there should be a way to streamline the cycle a bit more.

What is the biggest mistake that new developers generally make? How can you mitigate this?

In terms of mistakes, I think new developers generally have a cost issue. It is important to shop smart, be prudent on the construction costs and to avoid using rough figures. I would recommend employing a QS to spec and price your project. It’s natural to overestimate but this cost gets pushed onto the end user. By being more careful with calculations and keeping the GDV as low as possible, your property will ultimately be more attractive in terms of pricing in the long run.

What advice would you give to someone looking to take out a residential bridge?

I would say that you should only use a bridge if you really need to. When it comes down to it, work with lenders who clearly want to develop a relationship with you rather than tick boxes. The biggest trap is always going for the cheapest option or the most well-known lenders. Shop around and work with someone who you feel is genuinely interested and invested in your project.


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