UTB provides £8.5m bridge for £65m West London care home redevelopment
The completed development has an estimated £49.1m turnkey gross-development-value (GDV), with a potential stabilised value exceeding £65m.
United Trust Bank (UTB) Structured Property Finance has provided an £8.5m commercial sales bridge to support the refinancing and progression of a care home development opportunity in West London.
The 12-month facility relates to a commercial property with planning consent for redevelopment into an 85-bed elderly care home.
The completed development has an estimated £49.1m turnkey gross-development-value (GDV), with a potential stabilised value exceeding £65m.
The facility was structured by Martin Cameron, business development director – structured property finance at UTB, following an approach from Neil King of Darkwood Commercial Finance on behalf of client Duncan Thomson.
Thomson leads the special purpose vehicle (SPV), comprising a consortium of experienced real estate investors which acquired the ageing commercial property before securing planning consent for the redevelopment.
The funding enabled the SPV to refinance its existing senior and mezzanine finance and provided capital to secure vacant possession through the surrender of the remaining commercial leases.
It also provides additional time to prepare the asset for sale or forward funding.
The project has attracted interest from an experienced care home operator looking to take a long lease on the completed development.
Thomson said: “This funding provided us with the flexibility and certainty we needed to move the project forward.
“UTB understood both the complexity of the transaction and our longer-term objectives, working closely with us to deliver a solution that allowed us to complete the remaining lease surrenders and prepare the site for its next phase.
“Having a lender able to take a pragmatic view of the opportunity and respond quickly was invaluable and we are now progressing what will become an important addition to local elderly care provision.”
Cameron added: “This transaction reflects continued demand for specialist funding solutions supporting the healthcare real estate sector and demonstrates the value of bespoke specialist finance in helping experienced investors unlock opportunities that conventional funding may struggle to accommodate.
“By understanding both the asset and the borrowers’ exit strategy, we were able to structure a facility that met their needs and provided the flexibility required to maximise the value of the scheme.
“Demand for high-quality elderly care accommodation continues to grow, and developments like this play an important role in increasing the supply of modern care facilities.
“We’re pleased to have worked with Neil King and supported Duncan and the SPV at an important stage of the project’s evolution and look forward to seeing it progress.”
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