Finding Flexible Finance For £600,000 Glamping Site Expansion

By Rose Brown
Content writer
Published: 22 January 20231 minute read
Finding Flexible Finance For £600,000 Glamping Site Expansion

Landowners looking to expand into the popular glamping sector need to invest in both accommodation and infrastructure, which can be prohibitively expensive. While lenders are willing to support glamping businesses, it can be a challenge. See how one Scottish landowner overcame this with our expert help.

Table of Contents

Following the pandemic and a subsequent change in consumer behaviour, the UK holiday let industry has never been more successful. Property investors are now facing the legitimate question of whether a traditional buy-to-let or holiday-let is a better choice. 

For those who own large sites with spare land, luxurious glamping facilities are an appealing choice due to guest popularity, high return on investment and relatively low maintenance costs. The real issue is in the design and development of glamping sites, which often require a comprehensive project to renew the site and its infrastructure to make it ready for guest habitation. 

For one Scottish landowner who had already operated a successful holiday home in the highlands, the prospect of utilising spare land for glamping was appealing. To raise the finance required for both the land and accommodation, they turned to Rangewell to see how we could help.

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Why was there a problem?

Despite the client’s experience as a holiday let owner, the development of a new site required a significant financial investment of at least £600,000, split between accommodation and land development. The client identified 10 units to build at the cost of around £30,000 each and the overall site infrastructure was quoted at £320,000.

Facing such a cost, the client wanted to identify lenders that could support the glamping market and help them realise their vision. Unfortunately, many lenders can be less enthusiastic about glamping and holiday properties compared to more traditional, ‘stable’ investments such as buy-to-lets. Most lenders demand security and in this case they sought to make the client leverage their other holiday properties to fund the work. The client realised that trying to negotiate on their own would see them either be refused or forced to accept a subpar agreement, so they came to Rangewell for help. 

Why we were able to help

We have extensive relationships in place with every lender in the UK, meaning we know exactly who to approach when a client comes to us with a specific need. In this case, we know the lenders who have shown interest in glamping as a sector, and we were able to quickly identify them, highlight them to the client and discuss the strengths and weaknesses of each. 

The client faced different options depending on their leverage commitment: they could either take out a development loan for the site or raise money with their holiday property portfolio. We created a shortlist of five different lenders who provided various options across 24 months. 

The client had to choose between two types of loan. The first was one that utilised phased payments, which meant they could commence the groundwork, draw more cash on completion, purchase and install the first five units, and then continue to draw cash as each stage was completed. 

The second option was for a lump sum payment at a slightly higher rate of interest. This was the client’s preference because, despite the higher cost, it gave them more freedom around the development process. 

With Rangewell’s help, however, the client was able to utilise their experience as a successful holiday let manager to reduce lender hesitation and secure a better offer. They received a full lump sum payment for the amount they required at a rate of just 6.3% per annum. 

Finance your glamping plans

Glamping sites are gaining in popularity, leading to lots of new interest in the industry. As more competitors enter the market, landowners need to act quickly to get their site up and running so they can establish themselves and attract guest bookings. 

Traditional lenders such as high street banks may be slow to support the glamping sector, but things are changing. Here at Rangewell, we speak to lenders daily to discuss new industry events and investment opportunities – so we know which lenders are interested and can help you find the capital you need to get your glamping project underway.

Contact us today or read our full guide to developing a glamping site here. 

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