Large-scale refurbishments are often where the real value in property lies—but funding these complex projects in 2025 requires more than a standard mortgage. Whether you're repositioning a block, converting a former commercial site, or upgrading a large HMO or mixed-use asset, the finance options available—and how they’re structured—can determine whether the project succeeds or stalls.

In this guide, we explore how property professionals are funding large-scale refurbs this year, what lenders are looking for, and how Willow helps clients structure smarter deals.

Why Large-Scale Refurbishments Are Booming in 2025

Several trends are driving renewed interest in heavy refurbishments:

• Commercial-to-residential conversions driven by planning relaxations and demand for housing
• Upgrades to meet EPC and energy efficiency regulations
• HMO licensing changes, pushing landlords toward compliant, higher-yielding refurb models
• Value-add opportunities in secondary locations where acquisition costs are more attractive

The opportunity is clear—but these projects often fall outside mainstream lending criteria.

What Type of Finance Do You Need?

For substantial refurbishments, traditional mortgages are rarely suitable. Instead, investors and developers typically rely on:

✅ Bridging Loans with Refurbishment Drawdowns

Short-term loans released in stages to fund the works. Interest can be rolled up to avoid monthly payments during the project.

✅ Development Finance

Often more suitable for structural refurbishments or extensions, especially where costs exceed £500,000. Offers higher gearing than bridging but with more detailed underwriting.

✅ Mezzanine or Second Charge Lending

Used to top up a senior loan if equity is tight. These are higher risk and more expensive but can unlock complex capital stacks.

✅ Private Bank Lending

For experienced borrowers with assets under management (AUM) or high net worth profiles. Offers flexibility, but often comes with relationship or investment expectations.

Key Lending Metrics in 2025

• LTV (Loan to Value): Up to 75% (bridging), 65–70% (development)
• LTC (Loan to Cost): Typically 65–80%, depending on project scope
• GDV (Gross Development Value): Most lenders cap at 65–70% of expected final value

🔑 Understanding these metrics—and how they interact—is critical. For a full breakdown, see our guide: LTV, LTC, and GDV Explained

What Lenders Will Want to See

• Detailed schedule of works with costs and contingency
• Planning permissions and building regs approval
• Track record if the works are significant
• Exit strategy, such as sale, refinance, or rental

Many deals fail not because they’re unviable—but because the application fails to present the above clearly and convincingly. That’s where expert structuring and lender selection make the difference.

Common Mistakes to Avoid

• Assuming you can use a standard buy-to-let mortgage for a heavy refurb
• Underestimating build costs or failing to include contingency
• Starting works before finance is secured (many lenders won’t fund retrospectively)
• Overvaluing the GDV or assuming the rental uplift is guaranteed

How Willow Helps

At Willow, we support clients with every aspect of funding a major refurbishment:

• Structuring bridging and development loans tailored to your works
• Working with quantity surveyors, valuers, and legal teams to move quickly
• Advising on exit strategies to ensure you’re not left without a refinance
• Sourcing options across specialist lenders, private banks, and bespoke funders

📚 Read how we helped a London developer unlock £5M for a large-scale conversion:
👉 Case Study: £5M Refinance for a London Developer

Final Thought

If your 2025 property strategy includes major refurbishments, the right finance can be the difference between success and stagnation. With rates still volatile and lenders selective, it pays to work with a broker who knows how to navigate the market—and who can make your project stack up on paper and in reality.



📞 Want Help Structuring Refurbishment Finance?

Book a free strategy call with one of our mortgage specialists.

We’ll help you find the smartest way forward—whatever rates do next.