Build to rent refinance

Who can borrow and what lenders look for

A build to rent refinance is underwritten on the built, let asset, so the case rests on the income and the value rather than a construction appraisal. Lenders want to see the rent roll, the stabilised or stabilising net operating income after voids and operating costs, the occupancy, which CBRE put at around 97 percent for stabilised UK multifamily in September 2025, and the rental growth supporting the income, which Knight Frank recorded at around 4 percent across the UK private rented sector for the year. They size the new facility so the income covers the debt service at a debt service coverage ratio of around 1.3 to 1.5 times, and they apply a loan to value of around 55 to 65 percent to the stabilised value, which is set by the net operating income capitalised at an investment yield. The yield drives the value and so the equity that can be released: Knight Frank put Tier 1 regional multifamily at around 4.50 percent in September 2025, and a keener yield lifts the value above the development cost, creating the headroom a refinance releases. Where a scheme is still letting, lenders will look at the lease-up and may prefer a development exit step first, refinancing fully onto investment finance once stabilised. A regulated owner-occupier element, where it arises, is referred to an authorised firm. We assemble the income, the value and the lease-up evidence so the lender sees a durable, income-producing asset ready for long-term debt.

How much you can borrow

A build to rent refinance is sized on the stabilised value of the built, let scheme and the income that supports the debt service, so the achievable loan keys off the net operating income and the yield rather than the original development cost. Lenders apply a loan to value of around 55 to 65 percent to the stabilised value, but the binding constraint is usually the debt service cover, sized to a debt service coverage ratio of around 1.3 to 1.5 times on the net operating income. The amount of equity a refinance can release depends on the gap between the stabilised value and the development cost the old loan was sized against: where the value, driven by the rent roll and a keen yield, sits well above cost, the refinance can repay the old debt and free capital for the next scheme. The yield is central, because the value is the net operating income capitalised at it: Knight Frank put Greater London prime multifamily at around 4.25 percent and Tier 1 regional cities at around 4.50 percent in September 2025, and a keener yield lifts the value and the equity released. Knight Frank also forecasts cumulative UK private-rented-sector rental growth of around 18.8 percent over 2025 to 2030, which supports a lender's confidence in the income over the term. We model the stabilised value, the DSCR, the loan to value and the equity release together, so the figure is grounded in the income the asset produces.

Rates and costs

The reason to refinance is cost: investment finance is priced more keenly than the development or bridging debt it replaces, because the asset is built, let and income-producing rather than under construction or held on a short-term bridge, so the rate is indicatively a margin over SONIA that prices well inside the debt being repaid. Expect a lender arrangement fee of around 1 to 2 percent on the new facility, a valuation on the stabilised income and yield, and legal fees for both sides. The key cost to weigh is any early repayment charge on the development, exit or bridging facility being redeemed, which should be set against the saving the lower rate delivers and the value of any equity released, because a refinance that incurs a charge can still be worthwhile if the saving and the freed capital outweigh it. The choice between a fixed rate and a margin over SONIA is a genuine decision: a fix gives certainty of cost but usually carries its own early repayment charge, while a variable margin moves with rates and is easier to exit at the next step. We disclose our broker fee in writing, model the saving, the equity release and any early repayment charge together, and never claim an exclusive tie to any lender.

Refinance, development exit or a sale

A build to rent refinance is the right move when a scheme is built and stabilising or stabilised and you want to hold it, lower the cost of the debt and release equity. It differs from a development exit facility, which is an intermediate step taken at practical completion to repay development finance during lease-up, where a full refinance onto investment finance is the destination once the rent roll stabilises, often reached via that exit step. It differs again from a sale, which realises the value in full and exits the asset, where a refinance keeps the asset, recycles equity and retains the future rental growth and any further yield compression. The choice between refinancing and selling turns on whether you want to hold the income, with Knight Frank forecasting cumulative UK private-rented-sector rental growth of around 18.8 percent over 2025 to 2030, or realise the capital. We model the refinance, the equity it releases and the income it retains against a sale, so you settle the scheme onto the capital structure that fits your plans.