Commercial Property Development Finance in Brighton

What this means for Brighton developers

For Brighton schemes we are quoting senior development debt at 9-12% with 65-70% LTGDV typical for experienced sponsors on conversion and small new-build, tightening to around 60% LTGDV where planning risk is material or sponsor track record is limited. Bridging for auction purchases and pre-planning site control starts from 0.65% per month with 70-75% LTV achievable against current values where a clear residential exit is in place. The economics favour small-site conversions, HMO retrofits where permission exists, and selective ground-up flats on backland or yard sites. Exit assumptions should be calibrated to the £299,725 flat median rather than the £415,000 city-wide figure when underwriting flat-heavy schemes, and stretched values above £750,000 per house unit need postcode-specific comparables out of Westbourne Gardens, Sussex Square or the Seven Dials grid rather than reliance on a city average. Build cost inflation has eased but coastal logistics, conservation-spec finishes and access constraints in the lanes and Kemp Town terraces continue to add 10-15% over equivalent inland Sussex projects.

Brighton and Hove's planning register is not feeding our dataset for this period, so we cannot quote application counts, pending GDV or approval rates for the city directly. The wider East Sussex picture provides useful triangulation: Lewes District continues to throttle major schemes through its conservation-area framework, with most consented activity concentrated on edge-of-settlement infill and small conversions; Hove (within the same Brighton and Hove unitary authority) is running on similar conversion-led economics with the Western Road, Church Road and Portland Road corridors carrying most of the small-scale residential activity; and Eastbourne to the east remains the pressure-release valve for sponsors priced out of Brighton itself. The practical read for developers underwriting Brighton in Q2 is that the city's planning constraint is structural rather than cyclical. Article 4 directions cover large parts of central BN1 and BN2 restricting C3-to-C4 HMO conversions without full permission, the South Downs National Park caps the northern edge, and the seafront and conservation footprint between Hove Lawns and Kemp Town keeps most large new-build off the table. Sponsors should budget 18-24 weeks for full determination and material pre-app engagement before committing acquisition capital.

We expect the second half of 2026 to favour sponsors with funded pre-app engagement and Article 4-aware schemes over speculative acquirers. The 3.8% year-on-year price reading provides some exit tailwind that has been absent from London comparables, but it is not enough to rescue a poorly underwritten appraisal. ICR stress testing on refinance exits should be built around 9-10% senior rates and a flat-median exit assumption. Sponsors targeting student HMO product should expect tighter planning scrutiny rather than easier consents, and we would steer first-time developers toward Hove and Portslade addresses inside the same unitary authority where competition for sites is less ferocious than central Brighton.

Brighton is supply-constrained by design: 2,765 transactions, 3.8% year on year, and a planning regime that rewards patient sponsors.