Debt to Gross Development Value (GDV) ratio is a critical measure in UK property development finance that compares the amount of debt used to the projected market value of a completed development. Calculated by dividing total borrowing by the GDV, this ratio assesses the extent of loan financing relative to expected sales proceeds. It helps lenders evaluate risk by showing how much debt is secured against potential income, ensuring the project’s financial feasibility and repayment capacity.
This sits beneath Leverage Ratios, introducing a more specific variant of the measure without changing its core interpretation. It is commonly considered alongside Net Debt to GDV, as both are closely related measures used to assess similar aspects of performance or risk. In funding terms, Debt to Gross Development Value (GDV) is most commonly encountered in connection with High-LTV Development Finance within the property development capital stack.
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