Croydon Development Finance: 3 Unit Residential Scheme at Palmcroy House 387 London Road Croydon CR0 Enters the Pipeline

A new office to residential scheme has joined the Croydon pipeline. Application 25/02864/GPDO, covering Palmcroy House, 387 London Road, Croydon CR0 3PB, is currently pending decision according to the London Borough of Croydon planning register (Idox).

The proposal, as described on the London Borough of Croydon planning register (Idox), is a change of use of the ground floor from office (Use Class E) to residential (Use Class C3) to provide 3 flats under Schedule 2, Part 3, Class MA of the Town and Country Planning (General Permitted Development) (England) Order 2015 (as amended). The register confirms 3 units are proposed and records the target use class as residential.

Class MA prior approval applications like this one sit in a different risk category to full planning applications. The principle of residential conversion is established by the Order itself, so the council's assessment is confined to a defined list of matters such as transport, contamination, flooding, noise and natural light. For sponsors, that usually means a shorter and more predictable route to consent, which in turn shapes how lenders price the site.

On numbers, we estimate a gross development value of £795,000 for the completed flats. That is a Construction Capital estimate derived from the scheme details on the London Borough of Croydon planning register (Idox), and any lender will form its own view through a formal valuation.

From a funding perspective, a 3 unit conversion at this scale typically draws on three products in sequence. First, site or acquisition finance: bridging specialists and specialist commercial lenders will lend against the existing building, often with an uplift once prior approval is granted. Second, the conversion facility itself: at a build cost profile consistent with a ground floor office strip out and fit out, specialist commercial lenders and some challenger banks will fund works in staged drawdowns against a monitoring surveyor's sign off. Third, the exit: either sales of the individual flats or a development exit bridge to refinance the facility once practical completion is reached, releasing the sponsor to sell without pressure from a maturing loan.

Our read from the desk: sub £1 million GDV conversions in this corridor remain fundable, and the London Road frontage gives the scheme an obvious comparables base. The points lenders will probe are the service arrangements for the flats, natural light to each habitable room, and the realism of the £795,000 end value against local sold prices. Sponsors should line up a costed schedule of works, a QS or contractor quote, and evidence of comparable flat sales before approaching lenders, because those three items drive leverage more than anything else at this ticket size.

We track schemes like this across the borough on our Croydon development finance page, where local sponsors can see how similar conversions have been funded. If Palmcroy House secures its prior approval, we would expect terms from several lender categories within days rather than weeks, and we will update this item once the London Borough of Croydon planning register (Idox) records a decision.