Securing complex finance for a high value property development portfolio

What was the situation?

Our client, an experienced property developer with multiple successful projects in the UK, had just completed a multi-unit development project and was at the point where he needed to pay back their existing development finance lender. He had already lined up some individual Buy to Lets (BTLs) to refinance the existing development loan however, had found a new development opportunity that he were keen to pursue. Time was of the essence in securing the new site, and he needed to raise equity quickly.

Having carried out their own investigations, the client was informed that the BTL lenders he was working with were unable to release any further equity from the asset and could only raise sufficient funds to pay off the existing loan. Having already established a relationship with the client, he approached LDN Finance and requested we put a deal together, encompassing all units all in one loan from a new lender who would be able to release sufficient equity from the portfolio of units.

We needed to secure 75% LTV of the full aggregate market value (£5.6m) for the client as it was a completed development for 19 residential units that were fully let.

What was the issue?

Having already explored the standard options available, the client had been unable to source a suitable lender at the right pricing and leverage required.

Due to our extensive experience in the market, we knew that we needed to work off the aggregate market value (AMV), not the block value which would enable enough equity to be released.

What was the process?

Due to our robust knowledge and relationships with lenders across the market, we knew which lender to approach for our client’s case. We worked closely with them for flexibility within their funding line due to the specialist nature of this case.

After multiple upfront conversations prior to formal submission of the application, we managed to get an ‘in principle’ approval from the lender’s credit committee through the sales director, who agreed to provide the loan exactly as requested at a market leading rate.

In order to present this case to a lender for consideration, we wrote a detailed presentation which provided additional information on the strength of the client from the outset, and the asset, along with supporting comparable projects. With this provided, it made the process run smoothly outside of normal criteria. We were on hand to assist the client through every stage of the deal.

What was the solution?

Due to the number of elements that were outside standard criteria of this case, we provided advice for an investment loan on a 5-year fixed rate, therefore releasing the required amount of equity which enabled the property investor to complete on the new acquisition.

We were given access to an exclusive rate that was highly competitive at just over 4%. This allowed us to reach 75% of the Aggregate Market Value as desired, enabling the client to complete on the new acquisition successfully.

As a result, they were over the moon with the smooth transaction and are now a returning client with further deals.

Lending solutions with LDN Finance

Are you a property developer with a multi-unit project in the pipeline? Perhaps you have a complex scenario that needs bespoke development finance?

At LDN Finance, our specialist team has extensive experience in securing short-term finance solutions suited to your circumstances – no matter the complexity. Working closely with our trusted network of private banks and specialist lenders, we’re sure to secure a bespoke arrangement for your project at competitive, market-leading rates.

Get in touch with us to organise an initial consultation.