Industrial unit refinance
Refinance of a newly-built warehouse complex onto a term loan, releasing capital for further property development.
Sector
Commercial property investment
Location
Bristol
Purpose
Capital release for further investment
Scenario
Our client had developed two industrial units on separate titles and put them out on leases to numerous commercial tenants. Lease terms ranged from 12 months to 5 years. They wanted to release capital from these income-producing assets to fund future property investments and developments.
Problem
With weaker commercial covenants and shorter lease terms our client’s bankers were unwilling to lend against the assets, despite a diverse spread of incomes. Also, due to sector restrictions the high street banks were unable to leverage the assets to their full potential.
Solution
BIZL presented the case to a range of specialist lenders and challenger banks in order to give our client competitive comparable terms. We progressed the application through to underwriting with a specialist lender and despite valuation challenges and significant market volatility we were able to structure a deal for the client.
We completed on a loan of £1.5m at 75% loan to value (vacant possession value), with part interest only and 5% amortising over 5 years. This term loan was structured as one loan secured against 2 commercial assets.