NEWS
Arc & Co's Tom Savill Provides Insight on the Art of Structuring a Deal in Uncertain Times
In the January edition of Business MoneyFacts Magazine, Arc & Co.’s Tom Savill provides insight on the Art of Structuring a Deal in Uncertain Times.
To view the full article, click here.
Arc & Co. has Completed a £19.25M Refinancing of a Hampton by Hilton Hotel in the Home Counties.
Arc & Co completes the £19.25 million refinancing of a prominent home counties Hampton by Hilton hotel.
The hotel is centrally located in a prime South East town. It is directly opposite several major transport connections, at the heart of a major mixed-use development and regeneration scheme. With easy access to central London and a major international airport, the hotel benefits from strong leisure and business client occupation, underpinning its consistently robust performance.
Arc & Co, who have recently completed record lending volumes, acted for the borrower, an established private investor, with multiple commercial and residential property portfolios.
Edward Horn-Smith, Managing Director – Structured Finance at Arc & Co, commented: “We are always excited to work with a borrower to help them structure and expand their real estate portfolios. The loan provided by Octopus Real Estate has once again supported an important client of ours who has a proven ability in the real estate development, investment and management markets.”
Dominic Gibson, Investment Director at Octopus Real Estate, said: “This is another significant UK hotel financing for Octopus Real Estate. The sector has performed well throughout uncertain times, and our appetite for funding branded hotels is extremely strong. We have worked closely with Arc & Co for many years, providing funding to their high-quality client base across a range of asset classes. Broker relationships and repeat business underpin our lending and we are extremely grateful to Arc & Co for their continued support.”
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Arc & Co. Arranges £2.5M Exit Bridge Loan for 19 Flats and 2 Commercial Units in Colchester
Arc & Co. arranged a £2.5M exit bridge loan for a repeat client. This exit bridge loan was against 19 flat and 2 commercial units in Colchester.
Deal highlights:
£2.5M exit bridge loan
Originally the block was 26 flats and 2 commercial units.
LTV: 70% at 6.99% per annum
Loan was completed in 4.5 weeks
We were able to get the lender to use the previous valuer which meant the report was turned around in 4 days as they knew the property. Other lenders would not have accepted this.
Arc & Co. Close £2.3M Development Loan Against 12 Resi-to-Student HMO Properties
Arc & Co. have successfully structured and closed a £2.3 million development facility with a private lender against 12 separate properties in Liverpool.
Each property was an individual terraced house, which will now be converted to high specification student HMOs and ultimately let to the growing student market in one of the UK’s fastest growing cities.
Arc & Co. Structured Finance team comments: “Working on this opportunity was hugely exciting. Having previously worked with the same clients on individual units, I knew exactly how they worked and what they would want to achieve with this project. We managed to save the client approximately 5% interest per annum, by grouping several properties together rather than treating them as individual projects. This obviously generated a saving on professional fees as well as ongoing monitoring costs across the course of the transaction.”
They go on to add: “The loan was highly competitive for this type of project: 65% loan-to-gross development value, including 100% of construction costs, at 7% per annum with a 2% arrangement fee and no exit fee. Obviously this type of loan isn’t available for everyone, but for experienced clients building quality properties, these rates are available.”
Jordan Silverstone, Founder of Brickworks Properties, commented: “We’re glad to have found a sophisticated broker and lending partners who understand our model, can support our growth and will allow us to scale.”
Arc & Co. Secures Mortgage for Self-Build Client
Arc & Co. Secures Mortgage for Self-Build Client
Deal:
Client had been let down by another broker, who had assured him that it would be fine. Client started the work on the basis that money would be coming and then the deal with Hanley BS fell through.
Client had a partially built site and had run out of cash. He was director of four companies and had a very complex set of income streams, including a directors loan whereby he had taken the bulk of his income in the last three years. This had now stopped, but his tax returns were very low.
Solution:
Alistair placed this Harpenden BS who took a view on the clients share of net profit in the companies, and were happy to ignore the directors loan.
The site was worth £450,000 partially built, with an end value of £950,000.
We funded a deal of £250,000, with funds released in three tranches as the property increased in value.
4.39% self build mortgage with no early repayment charge.
Clients were delighted with the outcome.
If you wish to learn more about your residential mortgage options, please feel free to contact Alistair.
Alistair Hargreaves
Financial Consultant
Arc & Co.
30 St George Street, London, W1S 2FH
Office: +44 (0) 203 205 2129
Mobile: +44 (0) 796 750 9318
Email: alistair@arcandco.com
Arc & Co. Advises on the £1.76M Exit Bridge Loan for 43 House Development
Existing client based in the Home Counties successfully developed 43 2 and 3 bedroom houses in a desirable market town. With the last few units remaining the client wanted to release equity in which to purchase another site for future pipeline.
Julian arranged an Exit Bridge so that the client would not pay unnecessary fees when disposing of the remaining units. The facility was 70% LTV at 4.9% for the first 7 months attracting no ERC’s or exit fees. This was the most cost effective solution when comparing against a BTL product, whilst ensuring liquidity for the client.
Loan size £1,760,625
For more information about this Exit Bridge solution, please contact:
Julian King
Asset Finance Advisor
Office: +44 (0)203 205 2190
Mobile: +44 (0)773 445 7547
Email: julian@arcandco.com
Arc & Co. Arranges £8M Loan for 553-Bed Hotel Development in Liverpool
Arc & Co. advised on an £8m loan for a hotel operator in the North West.
The funding will support the initial stages of a 553-bed hotel development in Liverpool.
The specialist debt advisory secured the net loan of £8m against the residual value of the business plan, and the initial works will be followed by extensive refurbishment.
Planning consent has been granted to convert a part-vacant, eight-storey office and retail building into a 125-suite hotel.
Once trading, the hotel is expected to have a projected value of over £30m, with the building currently valued at £13m.
“This was a very interesting transaction given the intuitive response by my clients to reposition this asset,” said Charlie Armstrong, asset finance adviser at Arc & Co (pictured top).
“Securing a leveraged position against the residual value of this consent shows that there are solutions to the evolving nature of the tertiary office/retail market.
“Ultimately, it comes down to the strength of the business plan, so kudos to my clients for their delivery of this opportunity.”
Charlie Armstrong
Asset Finance Advisor
Structured Finance
Office: +44 (0) 20 3205 2127
Mobile: +44 (0) 771 705 4937
Email: charlie@arcandco.com
Arc & Co. Announces Record Month of Bridging
Arc & Co. Structured Finance completed seven bridging loans totalling almost £29.6M in October, representing its best month ever for bridging.
In total, the specialist debt advisory arranged 11 loans during the month, with the remaining four completions being development-based, with the overall loan amount totalling over £47m.
The average loan size for October stood at £4.5m.
Andrew Robinson, CEO at Arc & Co (pictured below), suggested that the figure could be attributed to the “uncertainty” currently attached to the specialist commercial and development lending options available in the market.
“Clients above all want completion certainty in a deal and with senior lenders being more cautious in this market, clients are using bridging to secure their purchases, which then allows time to asses all senior lending options to make sure the correct funding package is in place.
“Another point to add, is that out of the 11 loan completions, eight different lenders were used.
“A wide range of lenders were required because of the geographical spread and the speciality requirements of the loans.”
Arc & Co recently secured a £9m senior bridging loan with West One Loans against a vacant office building in London valued at £14m.
The debt advisory also recently appointed Matthew Yassin and Charlie Gordon to its team.
Arc & Co. Arranges £9M Bridging Loan on Vacant Office Building
Arc & Co. Structured Finance has worked with West One Loans to secure a £9m senior bridging loan against a vacant office building in London valued at £14m.
The loan was completed within one month of proceedings commencing, with mezzanine finance provided by a private second charge lender.
Sam Le Pard, asset finance adviser at Arc & Co, said: “This was a fascinating transaction to work on.
“Although the property did not have development consent at the time, it had a long history in planning and there was a great story to tell around the sponsor.
“To get to the net loan amount that the client required, we settled on a part-serviced, part-retained interest structure across the senior and junior debt.
“In order to achieve this, we had to work with sophisticated lenders who would understand the building, both in its current commercial state and as a residential development opportunity.”
Danny Waters, CEO at West One Loans and Enra Group, added: “It was great to work with Arc & Co on another satisfying transaction.
“We are delighted to be able to support these types of client and at every stage of their development process.
“Arc & Co drove the process throughout from conception to completion.”
For more information on this deal or how we might be able to advise you on a similar deal, please contact Sam Le Pard:
Office: +44 (0)20 3205 2195
Mobile: +44 (0)79 1715 4432
Email: sam@arcandco.com
Arc & Co's Edward Horn-Smith Providing Insight on the Future Value of Real Estate in a Post Brexit Britain.
Great piece in Bridging & Commercial about the panel of speakers, including Arc & Co.'s Edward Horn-Smith, providing insight on the future value of real estate in a post Brexit Britain.
Arc & Co's Matthew Yassin's Five Minute Interview with Bridging Loan Directory
Arc & Co. is a specialist debt advisory with headquarters in Mayfair, London providing specialist advice on real estate, marine & aviation assets.
Arc & Co. was awarded Development Finance Broker of the Year at the Business Moneyfacts Awards 2019 for the third consecutive year.
We speak to director, Matthew Yassin:
What is the best thing about being in the bridging and development finance business?
The fact that it is a dynamic environment and one that is constantly evolving. With global and local market movements and political uncertainty potentially affecting lending, directly or indirectly, it will always be an exciting and interesting business to be part of. On a more micro note, providing solutions for entrepreneurs and enabling homes to be built is a satisfying part of the job.
What keeps you focused?
In any industry you must enjoy what you do daily as this is where you find your passion. I find that working in the commercial finance industry keeps me focused, as I enjoy dealing with the ‘spilt wine’ that comes with every deal. Finding a way through things is particularly satisfying and the feeling of achievement once the deal completes is infectious!
What qualities do you look for in your employees or colleagues?
In my opinion this is an easy question to answer. It’s the simple things such as the ability to ask questions and re-read emails before sending them that really makes a difference. Raw talent is never enough these days; it’s the drive and curiosity that enables people to deliver against their objectives….. and this is something that you cannot teach!
Are you an optimist or a pessimist?
I always look up to the sky and smile. Its important to be conservative when needed but having a positive outlook on both life and business can lead to a great balance. Colleagues and clients can really benefit and feed off someone with a glass half full approach – even when there is no water in the glass!
What did you want to be as a child?
A commercial airline pilot.
What will be the greatest challenge facing the bridging and development finance industry in the coming months?
I think the lending industry will always face different kinds of challenges by virtue of who the industry supports; developers, commercial businesses, individuals, overseas investors and so on. However, over the next few months, the uncertainty surrounding the political environment will certainly present challenges. Although most lenders have already built this into their approach, it would be naïve to ignore the potential effects of the changes that will be upon us whichever way things end up.
Who or what makes you laugh?
Lots of office banter!
Do you dread Monday mornings?
You would dread something you do not enjoy, but I am very lucky that I get to work in an industry that I genuinely enjoy and want to be involved with. At Arc & Co., I look forward to Monday mornings as I don’t view this as a job and instead see it as me fulfilling a passion. I want to be successful and to keep learning and developing so that the advice that I give to my clients is always accurate and up-to date.
If you could change one thing about yourself, what would it be?
Lots of things that I could not possibly talk about in this interview!
With whom would you most like to have dinner?
Daniel Levy – I would ask if I could refinance the Tottenham Hotspur football stadium development finance facility, as I hear they’re re-positioning the debt as we speak!
Arc & Co. Advises on Funding for Limited Company that Owned Both Leasehold and Freehold
Deal:
Client, a very experienced developer, had built a small studio flat in Tunbridge Wells as part of another development. This was unencumbered, and the clients wished to capital raise to go towards their next project.
The primary challenge, it is a small studio flat, and both the freehold and leasehold were held in limited companies.
Property Value: £130,000
Loan Amount: £97,500
Solution:
After three other brokers turned down the chance to fund this deal, Arc & Co. kept persevering and found Gatehouse Bank, a specialist bank, were in a position to provide finance, as they were able to take a view on the wider view on the security and the client.
Alistair Hargreaves, Financial Consultant at Arc & Co. said,
“Its key for my clients that I am able to use my experience and knowledge to place a whole range of deals, especially the more complex and unusual ones. Having a provider such as Gatehouse Bank, is ideal as they are able to underwrite a proposal on its merits, and they will listen to a business case.”
Paul Stockwell, Chief Commercial Officer at Gatehouse Bank, explains,
“At Gatehouse Bank, we believe human underwriting suggests a degree of common sense and flexibility applies — and that’s absolutely essential. It is not a box-ticking exercise and should not just be a computer-based scoring system by another name. This is especially important for customers with more complex circumstances.”
If you wish to learn more about your residential mortgage options, please feel free to contact Alistair.
Alistair Hargreaves
Financial Consultant
Arc & Co.
30 St George Street, London, W1S 2FH
Office: +44 (0) 203 205 2129
Mobile: +44 (0) 796 750 9318
Email: alistair@arcandco.com
Arc & Co. Structures £7.25M Loan for Trophy Asset in Prime Central London
DEAL:
Arc & Co. structures £7.25M loan for high value trophy asset in Prime Central London.
Loan Amount: £7.25M
Property Value: £14M
Location: Mayfair
Rate: 4% fixed interest rate with 3-year rolled up interest
SOLUTION:
Due to the client having variable income, the loan amount could not be determined by a conventional income multiple. A business plan was drawn up showing the client’s future growth for his business combined with the current retained earnings, allowing us to get to the loan amount desired.
If you wish to learn more about your residential mortgage options, please feel free to contact our Residential Mortgage team.
Arc & Co.
30 St George Street, London, W1S 2FH
Office: +44 (0) 203 205 2129
Arc & Co. Structures Development Loan for Eco Bungalows in Cornwall
Deal
A ground up development of two 3 bedroom eco bungalows with swimming pool on the North coast of Cornwall close to St Ives Bay.
Loan Amount: £647,500 (100% of the construction costs)
Rate: 4.3% above 3 month LIBOR
LTV: 55% Loan to GDV
Terms: 15 months
Solution Provided
The client who is an experienced builder of 35 years with a great portfolio of private projects in the area, had never needed development financing before. He had been quoted an unrealistic facility with high interest that wasn’t suitable for the development by a local broker for a bridge product. After going to a few challenger banks for a small development facility, Julian King secured a solution by choosing to work with Principality Building Society as they are based in Cardiff, which kept the MQS fees to a minimum as well as providing an incredibly competitive interest rate.
David Burrows, Owner of Burrows Construction Ltd, said, “I was introduced to Julian who has successfully helped in sourcing development finance for my project “The Firs”. He was incredibly professional and diligent always keeping me updated with progress as well as guiding me through the application stage and driving the facility through to completion. Julian’s knowledge of the market helped me to raise suitable debt at very competitive prices, his development knowledge also ensured that we streamlined our monitoring processes keeping costs to a minimum. He has become a trusted adviser that I look forward to working with again on my next project.”
For more information about this deal, please contact Julian King:
Julian King
Asset Finance Advisor
t +44 (0) 20 3205 2190 | m +44 (0) 77 344 57547
30 St. George Street, Mayfair, London, W1S 2FH
Arc & Co. Advises on £1.38M Loan for Office Conversion into 8 Flats
Deal Breakdown:
Refurbishment to convert an office block into 8 residential units on Tonbridge High Street.
£1.38M
15 months
89% LTC
Solution Provided:
Competitive pricing with Avamore at 0.54% a month at 75% LTC and then bringing in Crowdlords to plug the gap in such short notice.
For any further information, please contact:
Tom Savill
Asset Finance Advisor
t +44 (0) 20 3205 2123 | m +44 (0)798 3400 318
Arc & Co. Secures £1.7M BTL Refinance for 7 Flats
Arc & Co. Secures £1.7M BTL Refinance for 7 Flats in Chertsey
Deal breakdown:
£1,764,000
5 year fixed @ 3.99%
80% LTV
This capital raise enables our client the acquisition of future development sites. 80% LTV mitigates relatively harsh valuation due to lack of up to date comparables. This allows our client the advantage on a sale to keep the net proceeds.
For any further information, please contact:
Jeremy Robinson
Asset Finance Adviser
t +44 (0) 20 3205 2199 | m +44 (0)7976 737552
Arc & Co. Completes £2M Residential Loan for International Client
Client: Nigerian resident domicile who works in the oil & gas industry
Requirement: Arc & Co. worked with this client on a refinancing basis and to redeem an existing loan with a lender that had moved away from the African market. The property was however, owned via a Channel Island trust.
Solution: We secured a £2M loan on £3M property at 1.75% over Libor and with an initial redemption of £250,000, with a further £250,000 to come in 6 months. This was over a 5-year period and interest only.
Contact:
Daire Dowling, Managing Director - Arc & Co. Private Finance
T: +44 (0)20 3205 2196
Arc & Co.'s Nikita Nigai Featured in Forbes Kazakhstan!
Why the Acquisition of London Property is Still Advantageous and Profitable
“‘Currently, the UK finance market can offer a solution for almost every client. If you do not wish to pay a large lump-sum payment straight away, it is worth to think about the mortgage which is being offered nowadays at 1.5% and goes up to 75% LTV with the term from 2 to 35 years. The property, in this case, would be the only collateral. In the past year we have noticed extensive interest from Kazakhs investors, where, in most cases, clients acquired an investment - BTL properties. It should be noted, that sometimes rental income can cover your mortgage interest payments, which is another advantage/argument to use the mortgage today.’”
For further information, please contact Nikita on:
Nikita Nigai
Asset Finance Advisor
Arc & Co. Private Finance
T: +44 (0)20 3205 2122
E: nikita@arcandco.com