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Delayed completion for faster profits

ninja learning Dec 10, 2018


I am looking for some inspiration on a potential property.  It is a lovely property that is presently mixed use as a business and flats.

It can be converted to five flats that will fetch a premium price due to the location. The person selling is prepared to listen to options and is prepared to let us develop out the property while she still owns it, therefore, minimal cost to us at purchase.

 I have a few ideas myself but am looking for a bit of inspired creativity.


One creative solution was suggested by one of my students who recognised that this opportunity fits one of the strategies I teach on my Ninja Investor Programme workshops.

Through our brokerage, we have financed a number of projects funded exactly this way. So this is not just theory, it works and works well when the number are right.

If you have the current owner’s agreement and permission to enter the property and do the required works to do the conversion, then the delayed completion strategy comes into play.

This could result in the only cash you need to put into this project is the cash required to do the conversion (apart from usual buying costs, SDLT etc.), you can borrow the rest.

The key to it is to complete the purchase using a bridging lender that will lend against the GDV you create by the conversion and who will ignore the actual purchase price you are buying at.

Here's the process

  1. Get the funding agreed with the bridger based on your projected GDV. Being as accurate as you can be on the GDV will serve you well here
  2. Exchange contracts with permission to enter the property and undertake the conversion
  3. Agree a future completion date that allows sufficient time for the conversion works to be finished and building in some contingency for unforeseen delays
  4. Get stuck into the conversion - you will need to use your own cash for this
  5. Whilst you work on the conversion, our brokerage team will be working on the bridging loan with the lender
  6. When the conversion is finished, we get the bridger’s valuer along to value what you have created. Even though the purchase price in known, the valuation is based on the actual GDV the valuer can see.
  7. On completion day the funding is drawn down
  8. You execute your exit strategy to sell or refinance to repay the bridger

Usually the result is that you can borrow around 100% of the purchase price but if the value the conversion has added is that significant, you could borrow 100%+. We have got up to 118% of the purchase price previously.


You can learn more by:


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