Three Tuns Development has secured funding on a large semi-commercial asset, with backing from Shawbrook, to develop student accommodation.
In 2016, Three Tuns Development acquired a former hotel and a parade of adjoining retail units in Durham city centre.
The existing hotel rooms were renovated and converted into student accommodation, and Three Tuns built three purpose-built student accommodation (PBSA) blocks within the hotel grounds.
Shawbrook facilitated an £18m funding package with a loan-to-value (LTV) of 65% to enable the development.
This included a £10m development exit loan, and £8m capital raise for future plans including onward investment.
The deal was completed in partnership with Franklin Commercial Finance, part of Synergy Commercial Finance.
Nic Franklin, director at Franklin Commercial Finance, said: “This has been a complex deal which Shawbrook have supported us with from cradle to grave.
“Our strong relationship has enabled us to provide a tailored, unique package to the client to secure further development.”
He added: “Student accommodation shortages are a well-known issue within Durham, so we’re delighted to support developments that address this problem and offer brand new, purpose-built facilities.
“Dylan and the wider team at Shawbrook have been fantastic throughout, and we appreciate their partnership in getting this deal over the line.”
Dylan Bleasdale, business development manager at Shawbrook, said: “We’re thrilled to get this deal over the line and support Three Tuns with some interesting and much-needed developments.
“Given the scale and type of asset, this was a complex process, and the support of Franklin Commercial Finance was key.
“After a high street lender turned away this client, we are pleased we were able to overcome the complexities of the deal and offer a bespoke funding package to deliver their investment mission.”
