Day One Loan to Value (LTV) represents the ratio of the senior loan advanced at completion to the property’s market value at that point, expressed as a percentage. In property development finance UK, this metric is critical for lenders in evaluating the initial security position before construction or refurbishment progresses. It is calculated as (Day One Loan ÷ Market Value at Completion) × 100. This differs from final LTV or Gross Development Value (GDV) measures, as it reflects leverage at the earliest stage of the facility rather than at project completion. Lenders use it to balance loan risk with asset value.
This sits beneath Senior Debt Metrics, introducing a more specific variant of the measure without changing its core interpretation. It is commonly considered alongside Day One Loan to Cost, as both are closely related measures used to assess similar aspects of performance or risk. In funding terms, Day One Loan to Value is most commonly encountered in connection with Bridge-to-Term Loan within the property development capital stack.
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