Large building projects require large budgets, therefore often requiring the involvement of a bank or other commercial lender. When funding something that hasn’t yet been constructed, the risk to the lender is significantly higher than normal mortgage funding against existing property. As such, many banks and lenders choose to instruct a Development Monitoring Surveyor to provide professional advice.
Combining our Surveying and Project Management skills, Lea Hough is able to act as Development Monitoring Surveyor in relation to commercial building projects.
Our role typically starts prior to construction and continues right through the build until final completion. By lending our professional expertise to a project, we are able to ensure the development work lives up to standard and expectation, therefore protecting the lender’s interests.
First and foremost, it is important to establish the viability of a project and that all the necessary due diligence has taken place. This usually involves producing an Initial Report, which looks at several factors including whether the correct planning permission and building regulations approvals have been sought, along with checking that warranties have been arranged and appropriate insurance is in place. We will also report back on the developer and the competency of their team, along with the suitability of any contractors that are in place. Our role also involves assessing whether the programme itself, and the associated forecasted costs, look sensible and realistic.
Provided that the bank is happy with the findings of the Initial Report, or once any changes have been made, the funds can be partially released and the project can commence. During the build, our Surveyors will typically undertake a site visit once a month, or as frequently as the lender requires. During these inspections, we will ensure that the job is on track and that work is being completed to the required standard. It is typical to produce a monthly Interim Report, providing information on our inspection and any concerns that are uncovered. The bank will typically use this report to sanction the drawdown of the next phase of funds to the borrower.
When a project has reached completion, our Monitoring Surveyor will conduct a final inspection visit. This will involve checking that the specification of the building meets the initial plans, allowing for any variations that have been agreed along the way. We will also check that all of the correct documentation is in place, along with any permissions or approvals required. Once any issues have been addressed, the lender will release the final sum to their client and the project can be handed over.
Lenders will often have tens to hundreds of thousands of pounds riding on a project’s success, so ensuring it is properly executed is vital. Lea Hough has experience of acting in a Development Monitoring role on behalf of a number of banks, having overseen the successful completion of several new build housing, retail and industrial projects across Lancashire.
For more information or to begin an initial discussion about involving our Development Monitoring services on a project, please get in touch.