CASE STUDY: RESIDENTIAL APARTMENT DEVELOPMENT SHEFFIELD

This case study highlights how INform Surveying partnered with a Property Developer and funder to build two blocks of apartments in Sheffield.

We tailored our involvement to ensure the funder’s financial safeguarding. We also provided independent consultancy to raise potential issues early so all parties could mitigate project risks.

Introduction and Client Background

Inform Surveying were appointed as the Independent Fund Monitor by a private Real Estate Investor and lending institution to provide ongoing project monitoring services for the construction of two residential apartment blocks located on a brownfield site in Sheffield. The scheme, delivered by a regional developer, aimed to create 38 high-specification apartments for private sale.

Given the scale and pace of the development and the fact that funding was being drawn down in tranches, the lender required robust technical due diligence and financial oversight to ensure the scheme progressed in line with agreed milestones and did not exceed the exposure limits relative to Gross Development Value (GDV).

Objectives of the Contract Administration Service

Our primary objective was to safeguard the funder’s financial interests throughout the construction lifecycle. Key aspects of our remit included:

– Reviewing the initial development appraisal to ensure that costs, contingency allowances, procurement routes, and programme durations were realistic and aligned with current market conditions.

– Conducting monthly site inspections, monitoring progress against the programme, and identifying cost or time risks at an early stage.

– Reviewing statutory approvals, including Building Control compliance, planning conditions discharge, warranty provider registration, and CDM documentation.

– Scrutinising monthly drawdown applications, verifying that valuations were substantiated by site progress and ensuring that claims did not exceed the lender’s exposure thresholds.

– Monitoring cash flow projections, cost movements, and value reconciliation relative to the agreed loan-to-cost and loan-to-value ratios.

Methodology and Contract Management Process

The project followed a traditional procurement route with a Design and Build contractor appointed under a JCT Design and Build Contract 2016. From the outset, Inform developed a baseline risk review and reviewed all key project documentation, including the construction contract, collateral warranties, performance bonds, insurance, and professional appointments.

Inform undertook monthly site inspections during construction to assess progress, workmanship, and sequencing. We issued comprehensive monthly Fund Monitoring Reports, which included:

– Independent valuation assessments
– Programme tracking and delay notifications
– Health and safety compliance (including statutory inspections)
– Commentary on certification (building control, warranty, and EPC progression)
– Updated cost analysis, highlighting any material change to forecast costs or GDV

We also liaised directly with the developer’s QS and project team, seeking clarification on any variations or cost pressure before drawdown approvals were given.

Findings and Solutions

This project moved quickly, with strong sales demand driving a push to accelerate delivery. Although this created some pressure on programme certainty, INform’s intervention enabled proactive risk mitigation. Key findings and outcomes included:

– Identification of procurement gaps in early subcontractor appointments – mitigated by implementing a more structured contractor onboarding protocol.

– Clarification on incomplete Building Control submissions – resolved through early engagement with the Approved Inspector.

– We verified monthly valuations, which, in several instances, were found to be overly optimistic about site progress. We rebalanced them through our measured valuations and phased drawdowns.

– Ensuring the lender’s exposure never exceeded the GDV threshold, even during peak construction spending.

– Confirmation at Practical Completion that all statutory certifications (Building Regulations sign-off, warranties, energy performance certificates, and Fire Risk Assessments) were in place to enable legal completion and apartment disposals.

Outcome and Client Feedback

The scheme was completed on programme and within the approved development budget. Sales progressed swiftly, and the development was entirely disposed of within six months of Practical Completion, enabling the loan to be fully repaid with interest in accordance with the agreed exit strategy.

Feedback from the lender highlighted INform’s technical commentary, responsive reporting, and pragmatic approach to construction risk as key reasons for the successful outcome. The client remarked:

“INform provided a crucial safeguard throughout the build, offering clear-headed, proactive advice that protected our position as a funder. Their reporting was precise and timely, giving us the confidence to support drawdowns and sustain progress on site. Their input ensured our exposure was never at risk – we will continue to use them across all development-backed lending moving forward.”

Conclusion

At INform Surveying, our expert contract administration services ensure that every construction project is delivered on time, within budget, and to the highest standard. By managing the contract process with precision and foresight, we help clients avoid risks, control costs, and achieve successful outcomes.

Need professional contract administration for your next project?

Contact INform Surveying today to learn how we can help you ensure smooth and efficient project delivery.