A fund worth £100 million has been launched by Aeriance Investments, offering access to bridging loans for residential property transactions in London.

Dubbed Orel, the fund is designed to profit from the dislocation of the short-term real estate lending market in the UK and already includes assets in locations such as Belgravia, Knightsbridge and Mayfair.

The bridging loans fund will continue to focus on this level of the market, making it particularly suitable for high net worth individuals who are looking for two to three-year financing deals in the London area.

Its main aim, however, is to provide an attractive risk-return and deliver regular distributions to its investors.

Daniel Bendavid, senior investment officer at Aeriance, commented: “The UK residential real estate lending market is still characterised by a dislocation which has been created by a significant lack of liquidity from financial institutions.

“We anticipate that this environment will continue for the forseeable future as new lending volumes from banks will probably remain expensive and severely limited, driven by new capital adequacy rules.”

He added that the problems that traditional lending institutions are currently facing without regards to ongoing legacy lending is also helping to provide a strategic opportunity for bridging loan providers to service the top end of the residential market.

The government is freeing up over a million in refurbishment finance for London’s RE:FIT energy efficiency drive.

The scheme, which is being led by London Mayor, Boris Johnson, will involve more than 100 public buildings being signed up to be retrofitted with energy efficient makeovers from the spring.

The finance, which is being paid for by the taxpayer, will be available from May 2012 and a range of buildings, including schools, hospitals, libraries and town halls, are all set to benefit from the refurbishments.

Some of the additions being introduced to London’s buildings will be solar panels, low energy lighting and fuel-efficient boilers. The Mayor hopes that the measure will significantly cut the capital’s carbon emissions, 80 per cent of which come from its buildings.

The scheme will help building owners to find the cash to pay for the upgrade of their facilities and they can even choose from list of pre-approved firms to carry out the work.

Savings will be made over time through reduced energy bills, which will help them pay back the refurbishment finance. Those not eligible could apply for a short-term loan to allow them to make changes and pay back the funding with resulting energy bill savings.

Upmarket boutique hotel chain, Malmaison, is to provide refurbishment finance for the once-revered Tay Hotel on the banks of the River Tay in Dundee.

Millions in development finance is making its way to the Scottish city, which is to host a new branch of the V&A museum. The new museum will form part of a wider £1 billion redevelopment of the waterfront area of Dundee.

Malmaison has taken on a 35-year lease of the Tay Hotel, which is one of the most beautiful buildings in Dundee. Although it has a proud place on the waterfront, it has fallen into disrepair. The renovation scheme is set to create as many as 125 jobs in the city.

Gary Davis, the new chief executive of Malmaison hotels group, said, "This is a fantastic project. The regeneration on the Dundee waterfront is already under way and we are delighted to have secured the lease on this property that will enable us to create a prestigious hotel on the site."

The news was also welcomed by Scotland First Minister Alex Salmond, who said, “Malmaison has chosen an excellent location in the Dundee central waterfront development."

Some £40,000 in property development finance has been offered for the Oakland Village care home project in Swadlincote.

The funding has been offered by Derbyshire County Council in a move welcomed by South Derbyshire District Council’s leader Bob Wheeler. “I will wait to see the details but I think it is very good news, especially in the current climate where money is tight,” he explained.

Mr Wheeler added, “I am due to visit and have a look round Oaklands in the next few weeks to see how it is progressing and I believe it is on schedule to open soon.”

The funding will also be available for housing-related support, including as many as 88 extra care apartments, which older people will be able to buy, rent or part-own for a period of up to four years.

Much of the money will go towards undertaking some refurbishment of the current site, which will enable the people currently living there to continue to do so.

The council has already helped with development funding for the community care centre at the site, which will include features like an IT suite, a meeting hall, a lounge and a shop.

Canary Wharf Contractors have successfully obtained commercial property finance to pay for the completion of the 25 Churchill Place project.

The 23-storey project is part of Docklands regeneration project and will actually be the last tower in the original plan for the scheme.

The funding has come in the form of a development finance loan, which Canary Wharf is very grateful to receive in light of the current economic conditions: “We are delighted to have concluded this facility in the current difficult financial market,” they stated.

The statement from Canary Wharf’s MD, Peter Anderson, went on to say: “It shows that with a good consortium of lenders and the right project it is still possible to raise significant construction funding. We can now start construction in early 2012 knowing we have secured all necessary finance.”

Half the building has already been pre-let to the European Medicines Agency, with a pre-agreed rate of rent on a 25-year lease totalling £46.50 per square foot. The firm will also receive a three-year rent holiday as they are to fit out the building. The lease starts from January 2015.

A Bridging loan worth £350,000 has been taken out by Formation Design and Build Limited to help with the ongoing working capital needed for the residential and commercial development in London’s E1 1PL.

The ‘Whitechapel’ development on Commercial Road in East London requires extra development funding to complete. The loan is being taken out over a 12 month period and interest is payable at six per cent.

Security for the loan has taken the form of a stake of the net profits of the development. Formation Design and Build is an arm of Formation Group Plc. Formation Group specialises in construction management consultancy work.

The terms of the loan reflect the new, stricter guidelines on short-term loans, which require them to be given on terms no longer than 12 months. Affordability is also a much more pressing issue when lending bridging loans, in an attempt to avoid unaffordable loans that borrowers will struggle to pay off.

The loan deal continues to illustrate how attractive East London is with developers and especially those who are looking to build residential homes and flats in an increasingly affluent part of London.

A think tank has called for a change in the UK land release and development finance policies in order for more new homes to be built and to boost the mortgage market.

The Institute for Public Policy Research (IPPR) has said that more needs to be done to free up land and developers need to think more clearly about when first time buyers want to purchase.

Another expert, Andrew Beer of Lime Tree Financial Services, said, “There needs to be more houses built. The problem is builders are getting a piece of land and planners are building the wrong types of houses in the wrong places.”

Funding is also an issue and more residential development finance is needed in order to bring about a greater number of housing developments. The IPPR said that there was a problem with banks "deferring realisation of bad debt", which overexposed them to the residential market during the boom years.

The report stated, “Only by reshaping how development happens and changing how land is controlled and released can we arrest the downward spiral that grips our delivery of new homes.”

In a move that will increase the reputation of the bridging loan market, the Financial Service Authority (FSA) is to introduce a set of new regulations to ensure bridging loans are affordable and remain short-term solutions.

Speculative short-term loans, with a term of greater than 12 months will be banned under the new rules, which are in their final consultation stage. They make up part of the FSA’s new Mortgage Market Review (MMR) and intend to reduce the number of unaffordable deals taking place.

Under the new plan, bridging loans will be redefined as a regulated mortgage contract lasting for a maximum of 12 months. Lenders will not be allowed to extend these terms. The MMR explained, “We are concerned that lenders may be extending the term of the loan when, in reality, the chance of the consumer being able to repay the second time around is no greater.”

Short-term bridging loans are popular and effective in many situations, not least when developers are keen to start a project, but are waiting for other assets to be sold in order to finance the work. This is also applicable to homeowners who are waiting for their own home to sell before being a able to build their dream home or buy a new house.

According to new research from property consultants Jones Lang LaSalle, a major shift in the property development finance arena is expected over the course of 2012.

The latest Offices 2020 research – which was produced by the West Yorkshire-based national office agency team at Jones Lang LaSalle – revealed that the on-going turbulence in the economic climate continues to play a key role in lending.

The traditional relationship between tenants and commercial landlords looks set to change as finance remains harder to come by, said the report, as occupiers begin to demand better terms from their landlords.

Bill Page, director of research at Jones Lang LaSalle, told The Huddersfield Daily Examiner, “A steady shift is taking place in the office market, including in West Yorkshire, as it is now even more influenced by demand … Flexible, long-term partnerships with developers and out-sourced service providers will lead to better outcomes for both parties, especially in the absence of debt funding.

“With careful upfront investment, all sides can benefit … Besides, funding for office development is unlikely to return to pre-2007 volumes, so inventive collaborations with corporate clients will be required to fill the gap,” added Mr Page.

The Offices 2020 report addresses the commercial property industry’s key issues and aims to assist developers, investors and tenants to gain a solid understanding of upcoming trends within the sector.

The report confirmed that development finance will remain ‘constrained’ throughout 2012 and that ‘alternative funding sources will be increasingly required.’

A Cambridge college has been completely transformed thanks to the securing of £3 million of refurbishment finance.

“The new building has significantly improved our facilities and provides a modern and professional teaching environment for our students,” explained the principal of Huntingdon Regional College, Susanne Stent. Those working at the college are aware that it is achieving great success elsewhere and that its building now effects its reputation for excellence.

The development added new facilities to the California Road campus building, including an admissions office and generally extended the existing buildings. There is now also a dedicated student services department, modern new learning facilities and additional classrooms.

The development has also added a two-storey atrium and a new refectory for students which overlooks the atrium.

Part of the refurbishment funding came from the Skills Funding Agency. It is due to be opened shortly after a two-year development process. Ms Stent added, “We want to choose someone from the community who is a former student rather than getting a celebrity or royal family member to open it.”

It will be opened during a public celebration on 19 January between 3 and 6pm.