Finspire Finance completes £2.8m GDV Property Development funding line for KREV Performance in Cornwall
A 22,000 sq ft commercial development in St Austell, Cornwall has secured development finance arranged by Finspire Finance through one of its panel lenders after the original lender before the client approached Finspire Finance withdrew while a later change in valuation contributed to an additional capital requirement of approximately £200,000.
The project is being developed for KREV Performance, a strength and conditioning gym operator that had outgrown its existing premises. The new building will accommodate the gym alongside additional commercial units, creating a health-focused scheme with a projected GDV of around £2.8m and development costs of approximately £2m.
The borrowers had already purchased the land using their own capital before seeking development finance for the build. An initial Agreement in Principle (AIP) was obtained in October 2025, with the quantity surveyor instructed the following month.
The QS subsequently increased the contingency allowance materially, reflecting the borrowers’ position as first-time commercial developers. The proposed steel-frame construction was also outside the original lender’s usual area of appetite. This meant that the original lender withdrew around a week after receiving the QS report, leaving the borrowers to replace the senior funding package after the project had already moved through its initial technical review.
James Earp, the founder and co-owner of KREV Performance said: “We were very confident when we received the Agreement in Principle. The lender understood where we were and what we were trying to achieve and was talking as though the deal was going to proceed. When we found out they had pulled the deal in a bizarre turn of events, we were super confused and disheartened. We did not understand how the position could suddenly be so different. It was a huge kick in the teeth, but also one that made us hungrier for success.”
A replacement lender and a revised valuation
Finspire picked up the deal in March and approached one of its panel lenders. The lender was comfortable with the proposed construction method and was able to use the earlier valuation and QS work as a starting point, with updated reports subsequently commissioned as part of the new process.
The refreshed valuation reduced the projected value of the completed development from approximately £2.885 to £2.775m following an increase in local property yields. Together with the parameters of the replacement facility, that change contributed to an additional capital requirement of approximately £200,000.
This presented a new issue; Senior debt remained available, but the overall funding structure now required more capital alongside it than the borrowers had originally expected.
Blake, director at Finspire who led the case, said: “The biggest threat wasn’t the lending, it was the capital contribution requirement. You can structure lending and find a lender who is comfortable with the project and the team, but if the borrower has already deployed their capital into the land, that remaining gap still has to be funded.”
Finspire, leaning on their pool of previously funded clients, connected the client with a private investor once the shortfall became clear. The borrowers negotiated the investment terms directly, and approximately £200,000 of additional capital was incorporated into the transaction alongside the senior development facility.
James added: “After the land was valued lower than expected, we faced having to find more than £200,000 of additional contribution. That was another major change to the position we had been working towards. We turned to Finspire, who were able to introduce us to an investor, and we agreed a structure that allowed the project to continue.”
Further matters around the final security and guarantee package were addressed as part of the wider credit process before completion. The details remained specific to the parties involved, but the transaction required the senior lender, borrower, investor and legal advisers to work within one agreed funding structure rather than treating the additional capital as a standalone solution.
Evidence of delivery and occupier demand
As is standard with property development deals, the underwriting process also required the borrowers to demonstrate how the project would be delivered and how the completed space would be used.
KREV Performance intended to occupy approximately half of the building, with the remainder available to third-party occupiers. Although the borrowers had residential development experience, this was their first commercial scheme of this type. One director also runs a project management business, while the wider team had direct operating experience in the fitness sector through KREV Performance.
A meeting between the borrowers and the lender took place as part of the final senior sign-off process. The discussion covered the team’s operating and project management experience, the proposed use of the building and the commercial case for the remaining units.
The clients secured rental Heads of Terms approximately 17% higher than the QS had anticipated, providing clear evidence that occupier demand supported stronger rental assumptions for the development.
The Cornwall location also required the borrowers to provide the relevant planning and mining-related documentation during due diligence, reflecting the area’s mining history. Those materials were made available to the professional team during the funding process.
Completion in September 2026
The facility completed in September 2026, around eleven months after the original AIP had been issued.
By completion, the funding route differed materially from the one envisaged at the start of the process. The original lender had withdrawn, a replacement senior lender had been introduced, the valuation had moved, approximately £200,000 of additional capital had been sourced and the borrowers had gone through further underwriting before final approval.
Construction is now underway, with the steel structure being erected and an estimated build period of approximately 12 months. One prospective occupier has expressed interest in purchasing one of the completed units, while the current plan is to refinance the remaining accommodation onto longer-term commercial mortgages after completion.
The transaction also illustrates why an AIP and a completed development facility are different stages of the same process. Valuation, QS review, borrower contribution, evidence of demand and the lender’s appetite all remain capable of affecting the final structure before funds are drawn.
For Finspire, the case also reinforced the importance of remaining involved after initial terms are agreed.
Curtis Bull, director at Finspire Finance, said: “Development finance is rarely a standardised process. When a transaction has several moving parts, the broker’s role is to understand how changes in valuation, lender appetite, security and capital affect the wider structure, and to remain involved through to completion. In this case, the funding route changed materially between the original AIP and drawdown, so the structure had to change with it.”
With valuations, QS requirements, lender appetite, legal work, capital structures and project-specific issues such as planning or mining documentation all capable of changing or emerging between AIP and drawdown, developers need enough support around them to keep the transaction moving. That means being able to focus on the business and delivery of the project while a hands-on broker manages the finance, coordinates the relevant parties, draws on its lender and professional network, and deals with problems as they arise. Put simply, focus on what you do best; finance is what Finspire Finance does best.