Novellus operates in the UK and Ireland, offering alternative funding solutions to that of the mainstream banks, secured primarily by real estate. Bridging finance has become an essential tool for property investors, developers and entrepreneurs who need quick access to capital.
Growth of the Industrial Sector
Over the past decade, the UK industrial and logistics sector has seen sustained growth. Demand spans light industrial units, general warehouse space, large distribution centres and last-mile fulfilment hubs.
According to Savills (UKWA Report 2024), total UK warehousing stock has grown by 61% since 2015, now standing at just under 690 million sq ft. Units over 1 million sq ft have increased in number by 345% in the same period, reflecting the rapid expansion of large-scale distribution. Take-up of units over 100,000 sq ft in 2024 reached nearly 28 million sq ft, above the pre-Covid average, showing the sector’s continued resilience.
The report goes on to say that growth is not without its challenges. While demand continues to rise, the planning system is widely seen as unfit for purpose, with local authorities often reluctant to approve large warehouse developments. This creates a shortage of both high-quality stock and viable development land. At the same time, government policy remains heavily focused on residential housing, often at the expense of infrastructure that delivers wider economic benefits such as local employment.
At Novellus, we understand these realities. Planning delays and supply constraints are part of the sector’s landscape and we work with our borrowers accordingly. By engaging early with planning consultants and by being flexible in our approach, we allow our clients to navigate these hurdles and take advantage of opportunities when they arise.
Novellus Case Study
Our client owned a c.10-acre site having secured outline planning permission for the development of 17 warehouse units (classes: B8 (Storage or distribution), Former B1(c) now Class E (Commercial, Business and Service Use) and B2 (General Industry) with associated access, parking, infrastructure and landscaping), providing c.170,000 square feet of space. The site was valued independently at £6 million and, once developed, the net development value (NDV) was estimated at £38 million. The uplift in value was supported due to both the strategic nature of the location and the ability of the scheme to deliver meaningful new supply into a sector with chronic shortages.
The outline planning consent provided the foundation for the scheme, but the borrower’s next step was to refinance an existing facility and gain access to additional funds to enable them to deliver the next phase of their business plan by securing the reserved matters planning.
Mainstream banks were not an option for our borrower. The process would have taken too long, introducing delays and uncertainty as to when and if funding would be provided. The borrower needed a lender who could provide both speed and certainty.
Fast, Flexible Funding
At Novellus, we understand that time is critical. Accessing mainstream capital can be challenging, whilst many alternative lenders rely on external funding lines, adding layers of bureaucracy, red tape and slow decision-making. Novellus is 100% privately funded so we eliminate these obstacles and we maintain full control over the speed and reliability of our lending decisions. To read more about why speed matters in bridging lending and how Novellus sets itself apart, a blog written by our Head of UK Bridging, Adam Forman may be of interest.
In this case, we refinanced the borrower’s existing facility and provided the additional capital that they required. By moving quickly, Novellus gave the borrower certainty of execution and confidence to move forward with their strategy. To understand more about our underwriting criteria and how we tailor our approach to the requirements of each deal, a blog written by our Head of Underwriting, Sam Kemp provides further insight.
Instructing the Best Professional Advisors
From enquiry to completion, we kept the process simple and focused. Our appointed planning consultants, QS and valuers carried out their appraisals expeditiously. Meanwhile our solicitors worked closely with their counterparts to ensure the transaction completed within a realistic timeframe.
Understanding the Business Plan
At Novellus we look beyond the numbers. The logistics and warehouse sector continues to attract strong demand and the planning position presented a significant opportunity to the borrowers. We shared the borrower’s confidence in the project and structured our funding solution to support the wider business plan, not just their immediate refinance requirements.
The Outcome
By refinancing the existing loan and providing additional capital, Novellus enabled the borrower to unlock the full potential of the site. The project is now well positioned to progress with confidence, supported by Novellus’ funding structure aligned with the ambition and scale of the development.
Why Novellus
This case study demonstrates what sets Novellus apart. We are privately funded, decisive and aligned with our clients’ goals. When timing is critical and when the right capital structure makes all the difference, Novellus is more than just a lender and is fast becoming the finance partner of choice.
If you or your clients are seeking fast and flexible funding, please feel free to reach out with your requirements and we will be happy to appraise.
Reference: https://www.savills.com/research_articles/255800/358461-0
