Paragon loan repaid early as Dundashill housing project reaches completion

The development was funded through a £15.9 million finance facility from FTSE 250 lender Paragon Bank, which has now been repaid in full almost six months ahead of loan expiry following strong sales performance across the scheme. Equity funding for the scheme was also provided by Housing Growth Partnership and igloo.

The first phase of private housing at Dundashill took just over two years to complete, with work starting on-site in January 2023. This phase has 78 three and four-bedroom homes that have all achieved an EPC rating of A. Port Dundas, where the scheme is located, is earning a reputation as a creative and urban sports destination, on Glasgow’s canal.

igloo’s Dundashill scheme has benefited from Paragon Development Finance’s Green Homes Initiative – a fund of £300 million dedicated to supporting developers to build sustainable homes. Any developer can utilise this fund if they believe their scheme will achieve an EPC rating of A across 80% of units, with the remaining being a C or above. If achieved, they can receive a 50% reduction on their exit loan fees.

All homes in this phase of Dundashill are modular buildings, constructed off-site at Glasgow-based contractor CCG Scotland. The properties have been fitted with solar panels, air source heat pumps and shower water heat recovery systems, along with other energy-saving features.

The deal was led on behalf of Paragon by Toby Burgess, relationship director, and Joshua Mann, senior portfolio manager.

Sam Lingawi, partnerships & investment director & Gary Watt, development director at igloo, said: “We’re delighted that Dundashill is now complete and we have been able to repay our facility to Paragon in full, whilst also taking advantage of the bank’s Green Homes Initiative – a great incentive for companies like igloo that prioritise building sustainable schemes. Toby and Josh have been great to work with, and we’re looking forward to carrying on our partnership with them in the coming years.”

Looking ahead, igloo has submitted a planning application for the next phase of the Dundashill neighbourhood, which will deliver a further 88 homes and is expected to be determined in the coming weeks. This next stage of the project continues igloo’s commitment to transforming the former industrial site into a vibrant, energy-efficient community.

Toby Burgess, relationship director at Paragon Development Finance, added: “This was our first scheme working with igloo and it’s fantastic to see the initial phase of private homes at Dundashill reach practical completion and residents living on site now. This early repayment underlines the market demand for high-quality, sustainable housing in the area.

“The scheme is truly forward-thinking and a great example of where the housing market should be going, with Igloo having put significant thought into the design and development. They have put the residents at the heart of everything they do. We look forward to working with Sammir Lingawi and Gary Watt again on another exciting scheme, as well as the fantastic teams at HGP and igloo, whose equity investments and commitment to delivering quality housing made this possible.”

Mike Murphy, investment director at HGP, added: “Alongside Paragon’s debt financing, our JV with igloo provided the much needed equity to fund the delivery of the Dundashill project. This is the first residential development financed and completed through this JV, which underscores the need for equity financing to get new homes off the ground in regional cities and the importance of close partnerships and collaboration in supporting developers like igloo in their mission of creating sustainable and quality homes at speed.” 

The development has already received significant industry recognition, winning Housing Development of the Year (Large, Private Sale) at the Scottish Home Awards, and two Gold Awards at the Scottish Design Awards for Residential (Multi-Unit) and Client of the Year, with further shortlistings at the AJ Architecture Awards and Herald Property Awards.