Refinancing a bridging loan against £11million commercial portfolio

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THE SCENARIO

I recently advised on an extremely complicated case for some clients looking for advice in regards to refinancing a bridging loan for two commercial properties in London with a combined value of £11million.

My clients were the directors of a Delaware based Limited Liability Company (LLC), a type of business entity which is popular for the flexibility and low start-up costs offered. However, unlike a Limited company set up in the UK, it is very difficult to secure borrowing against a property owned in such a way—something which is often not considered by clients who have been advised to work in this way.

My clients currently had expensive bridging finance against the properties, and needed to refinance, but had been unable to find a new lender due to the complexity of the structure. To complicate matters further, one of the commercial properties was not currently leased, having recently been used by my clients as an office. Many lenders will not lend against a commercial property with no lease.

OUR SOLUTION

They therefore needed a broker who could navigate the intense complexity of this situation. Enness Commercial has assisted many clients with refinancing a bridging loan, so we were happy to help.

I knew that most UK banks would not be able to accommodate for my client’s situation because of the reputational risk involved. The clients themselves were excellent candidates, however the structure of their property holding ultimately complicated the matter too much. I therefore approached an international lender, using my extensive network of industry contacts.

Fortunately, the assets in question were strong, so this lender was happy to lend against them. This lender was also willing to lend on a vacant possession basis, overcoming the problem of my clients not currently having tenants for one of the properties.

I negotiated a commercial mortgage at a rate of 3.15%, which was an excellent rate in light of the complexity of this case. If you are currently looking at refinancing a bridging loan against commercial property, and feel you would benefit from further advice, we would be delighted to assist you.