"We’re often approached by developers who’ve done everything right—site acquired, who have worked with us to get appropriate funding lined up from enthusiastic lenders, and then sit in Gateway limbo for 30 weeks. That kind of red tape kills deals."
- Alasdair McPherson - Rangewell
Specialist finance provider Rangewell has welcomed the government’s recently announced reforms to the Building Safety Regulator (BSR), but warns that persistent regulatory delays and rising costs are continuing to undermine the viability of small and medium-sized residential developers.
The reforms, announced on 30 June 2025, include the creation of a new Fast Track Process, key leadership changes, and the addition of over 100 new staff. The changes are aimed at helping the BSR deliver its goal of enabling the construction of 1.5 million safe, high-quality homes. The package also marks the first step towards the longer-term consolidation of regulatory oversight into a single construction regulator, in line with recommendations from the Grenfell Tower Inquiry.
Approval delays and cost pressures remain
While Rangewell supports the direction of reform, it notes that the operational issues facing SME developers have not been resolved. In particular, the lender highlights that Gateway 2 approvals—the stage requiring full building control sign-off before construction can commence—remain subject to lengthy delays.
New analysis shows that Gateway 2 approvals are frequently taking more than 24 weeks, double the statutory target of 12. In some cases, developers are waiting over 30 weeks for a response.
Between 1 October 2023 and 16 September 2024, the BSR received 1,018 Gateway 2 applications. Of these, just 146 were approved, representing only 14.3% of total submissions. A further 83.2% remain undecided, contributing to significant backlogs across the development pipeline.
These delays are also adding substantial costs. Government estimates suggest that each week of delay at Gateway 2 can add £10,000 to the cost of a project. A 24-week delay could therefore result in additional costs of £240,000—far exceeding the original estimated regulatory burden of £16,000 per scheme.
Call for targeted reform to support SMEs
Rangewell is calling for further reform to reduce the disproportionate impact of BSR delays on SME developers. The company has outlined a series of proposed actions:
Introduce legally binding approval timelines to prevent indefinite delays that threaten funding and viability.
Require compensation for delays exceeding four weeks to encourage accountability and mitigate cost escalation.
Develop an SME-specific Fast Track route to safeguard smaller schemes from prolonged approval processes.
Use risk-weighted triage to prioritise lower-risk projects and allocate regulatory resources more effectively.
Mandate formal written pre-application advice to help developers plan designs and financing with greater clarity.
Eliminate duplicated documentation in Gateway submissions to reduce consultant time and complexity.
Publish monthly BSR performance data to allow funders and developers to assess pipeline risk and make informed decisions.
“We’re pleased to see that the government has recognised the severe challenges within the BSR approval system and is investing to resolve them,” he said. “But the excessive red tape remains," explained Alasdair McPherson, head of commercial property finance at Rangewell. “We’re often approached by developers who’ve done everything right—site acquired, who have worked with us to get appropriate funding lined up from enthusiastic lenders, and then sit in Gateway limbo for 30 weeks. That kind of red tape kills deals."
“For SME developers in particular, faster decision-making is not a luxury; it’s a lifeline. The finance doesn’t wait. Every delay adds holding costs, risks funding offers expiring, and pushes viable schemes into the red. We see it every week," he added. “However, the scale of the problem demands more than just extra resources. It needs deeper structural reform to protect small and medium-sized developers from bearing disproportionate costs and delays.
McPherson concluded, “If a scheme is solid, funding isn’t the problem; the number of funders we’re speaking to looking to support SME developers has never been higher or more competitive—unfortunately, it’s the red tape that risks creating a market where only the largest institutional developers can afford to operate.”
