A rolling re-draw facility allows developers to re-access repaid loan capital during the facility term, giving more flexibility than traditional senior loans. It’s useful for schemes with sales-led cashflows or portfolio strategies where capital is recycled between units or sites. In UK property development finance, lenders may offer this structure with covenants or controls on re-draw timing and use. The approach supports liquidity across delivery phases, particularly for SME developers managing tight cash cycles or multiple exit events.
In practice, a rolling re-draw facility operates as a flexible extension of a Senior Revolving Credit Facility, allowing capital recycled from unit sales or refinances to be redeployed into the same or subsequent phases without requiring a new approval process. This can materially improve capital efficiency on phased developments or portfolio strategies, but lenders typically impose conditions around loan-to-value, sales thresholds, and permitted use of funds before each re-draw is authorised. It is often considered alongside Interest-on-Drawn Only structures, as both influence cashflow timing and cost of capital. Effective use is closely linked to maintaining adequate Cash Runway (Months) to avoid liquidity pressure.
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