Pre-Planning Bridging Loans | Land Acquisition Finance

Pre-Planning Bridging Loans

Pre-Planning Bridging Loans

Pre-planning bridging loans fund the acquisition of land or property before planning permission has been obtained. This is one of the most speculative — and potentially most profitable — segments of the UK property market. Acquiring a site at its current use value, securing planning consent, and selling or developing at the consented value can generate returns of 200-1,000% or more on the original investment. However, the planning process is inherently uncertain, and the bridging loans that support it must accommodate that uncertainty in their terms, LTV, and exit strategy.

Platinum Global Bridging Finance arranges pre-planning bridging loans from our office at 64 Knightsbridge, London. We access specialist land and development lenders who understand the planning process and are willing to lend against sites without consent, structuring facilities from £250,000 to £10 million. Indicative terms are delivered within 24 hours.

What Is a Pre-Planning Bridging Loan?

A pre-planning bridging loan is a short-term facility secured against land or property that does not yet have planning permission for its intended development use. The loan enables the borrower to acquire the site, fund the planning application process, and hold the site while the local planning authority determines the application. The exit is typically a sale of the site with consent at an uplifted value, or a transition to development finance to build out the consent.

Pre-planning bridging differs from standard land bridging in that the entire value proposition depends on an uncertain planning outcome. The lender values the site at its current use value — not its hoped-for development value — and lends at conservative LTVs that reflect the possibility that planning may be refused. If planning is refused, the borrower must still repay the loan, typically by selling the site at its current use value or finding an alternative exit.

When Pre-Planning Bridging Loans Are Used

Acquiring Sites at Current Use Value

The core strategy. An investor identifies a site — perhaps a disused commercial building, an industrial site, or agricultural land on the edge of a settlement — that has potential for residential or mixed-use development but does not yet have planning consent. The site is available at its current use value, which may be a fraction of its potential development value. A pre-planning bridge funds the acquisition while the investor submits and progresses a planning application.

Securing Auction Sites Before Planning

Land and property with development potential is regularly sold at auction without planning permission. The 28-day completion deadline requires immediate funding. A pre-planning bridge provides the acquisition capital, with the planning application submitted post-completion.

Option Agreements and Conditional Contracts

Some land transactions are structured as option agreements — the buyer pays an option premium for the right to purchase the land at an agreed price if planning permission is obtained. A pre-planning bridge can fund the option premium and the planning application costs.

Planning Gain Investments

Specialist planning gain investors acquire sites, submit planning applications, and sell the consented sites to developers at a significant uplift — without ever building anything themselves. Pre-planning bridging provides the acquisition capital for each site.

How Pre-Planning Bridging Loans Work

The lender assesses the site at its current use value — agricultural value for farmland, commercial value for business premises, or residential value for existing dwellings. LTV is based on this current value, not the potential development value. A pre-application discussion with the local planning authority, an architect’s feasibility study, and comparable consented sites nearby all strengthen the case. The exit strategy must address both scenarios: what happens if planning is granted (sale or development) and what happens if planning is refused (sale at current value, appeal, or revised application).

Terms are typically 12-24 months, reflecting the planning determination timeline: 8 weeks for minor applications, 13 weeks for major applications, and longer if the application goes to committee, requires an Environmental Impact Assessment, or involves a Section 106 agreement. Appeals add 6-12 months to the process.

Worked Example: Agricultural Land with Residential Potential

An investor acquires a 1.5-acre parcel of agricultural land on the edge of a village in the Home Counties for £180,000. The site is adjacent to a recently consented residential development and is identified in the local plan as suitable for future housing. Agricultural land value: £12,000 per acre (£18,000). Current market value reflecting hope value: £180,000. Potential value with outline planning permission for 12 houses: approximately £1.8 million.

Pre-planning bridging loan: £108,000 (60% LTV on the £180,000 purchase price). Interest rate: 0.85% per month, rolled up. Term: 18 months. Planning application cost (architect, planning consultant, ecology survey, transport assessment): approximately £35,000 funded from the investor’s own resources. Outline planning permission is granted at month 11. The site is sold to a housebuilder for £1.6 million at month 14. Total bridge cost: approximately £12,852 in interest plus £2,160 arrangement fee and £3,000 legal fees = £18,012. Net profit: approximately £1.6m – £180k – £35k – £18k = £1,367,000. The bridging cost represents approximately 1.1% of the net profit.

Pre-Planning Bridging Loans: What We Arrange

Loan sizes from £250,000 to £10 million. LTV up to 50-60% on current use value — conservative LTVs reflecting the planning risk. Interest rates from 0.75% per month — higher than standard bridging to reflect the speculative nature of the exit. Terms from 6 to 24 months, with extensions considered where the planning process is ongoing. We charge no broker fee on facilities of £500,000 or above.

Risks and Considerations

Planning refusal is the primary risk. If consent is not obtained, the site remains at its current use value and the borrower must repay the bridge from other means — a sale at current value, a revised application, or capital from other sources. The bridge term may expire before the planning process concludes, particularly if the application is called to committee, triggers an EIA, or is appealed. Extension fees apply. Pre-application advice from the local planning authority is strongly recommended before committing to a purchase. A positive pre-application response significantly reduces planning risk and strengthens the bridging application.

Frequently Asked Questions

What LTV can I get on land without planning?

Typically 50-60% of the current use value. The lender values the site at what it is worth today, not what it might be worth with planning permission. Higher LTVs may be available with additional security.

What if planning permission is refused?

You have several options: appeal the refusal (which can take 6-12 months), submit a revised application addressing the reasons for refusal, sell the site at its current value to another buyer, or use capital from other sources to repay the bridge. We discuss these contingencies before the facility is arranged.

Can I get pre-planning bridging on greenbelt land?

Greenbelt land is the most difficult to finance because planning consent is rarely granted except in very specific circumstances. Few lenders will consider greenbelt sites without strong evidence of development potential.

Does Platinum Global charge a fee?

No broker fee on facilities of £500,000 or above.

Related Bridging Loans

• Bridging Loans — our main UK bridging loans page
• Land Purchase Bridging Loans
• Permitted Development Bridging Loans
• Limited Company Bridging Loans
• Large Bridging Loans
• Development Finance
• London Bridging Loans