Weighted Average SONIA (Effective) is the blended interest rate applied across a property developer’s multiple loan tranches that reference the Sterling Overnight Index Average (SONIA). It is calculated by weighting each loan’s SONIA-based cost by the loan’s size within the overall facility, giving developers a single effective borrowing rate. This measure is important in property development finance UK, where different tranches of senior debt, mezzanine finance or revolving facilities may all accrue interest at slightly different SONIA levels. It helps lenders and developers understand the actual cost of capital across the full financing structure.
This sits beneath Capital Structure Complexity, introducing a more specific variant of the measure without changing its core interpretation.
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