Interest as a percentage of drawn debt represents the cost of borrowing calculated only on the funds actually drawn from a property development loan, rather than the entire approved facility. In UK property development finance, this measure reflects the true interest expense on the utilised portion of the loan, providing developers with an accurate assessment of financing costs during construction or development phases. By excluding undrawn amounts, it offers clarity on the active debt burden. It is typically calculated as (Interest Paid ÷ Drawn Loan Amount) × 100, helping developers manage and monitor their financing expenses effectively.
This sits beneath Debt Cost Metrics, introducing a more specific variant of the measure without changing its core interpretation. It is commonly considered alongside Cost of Debt to Gross Development Value, as both are closely related measures used to assess similar aspects of performance or risk.
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