Arc & Co. has completed a complex development facility for a pre-existing site in Acton.
Sam Beaumont (pictured), adviser at Arc & Co., has secured a loan of £3.85m for the development of eight flats – split into £2.99m of senior debt and a £857,000 mezzanine loan.
Across the funding package, Beaumont achieved 83% loan-to-gross-development-value (LTGDV), covering off most of the costs for the borrower, an experienced London developer and repeat client of Arc & Co.
As part of the structuring, the mezzanine funder also took equitable charges in order to satisfy the loan-to-value (LTV) required.
Beaumont sought the best lender pairing and most competitive pricing possible for this high leverage case.
Over the course of seven months, Beaumont took on a central role in the transaction and kept the deal on track, specifically in regard to the communication between solicitors.
Despite the challenges, the development facility of £2.9m was delivered at 65% LTGDV for 18 months, with the top-up mezzanine loan of £857,000 at 83% LTGDV for 12 months.
Beaumont said: “Finding a suitable mezzanine or equity partner was a very long process that included many calls and introductions between parties.
“Although Arc & Co. has a sizeable network of providers to tap into, every case and borrower is unique and we always conduct a full and thorough tender to find the most appropriate funder for the specific circumstances at hand.”
He said: “We’re pleased to have paired two lenders who have a good relationship – often an inherent challenge when working with more than one provider in the capital stack – and who could come together to support our client with the necessary funding.
“Overall, the solution will see the client able to complete the project and maintain their equity position.”
