Bridgebank Capital has backed an experienced property professional on the acquisition and conversion of a retail property scheme, which required the borrower to invest only 14% of the purchase price from their own cash funds.
The applicant had secured a discounted purchase price on a 21,000 sq. ft. disused retail property on an Option. They then successfully progressed plans for its conversion into two separate tenanted retail units, during the Option period. Prior to expiry of the option and on gaining the planning enhancement, the borrower approached Bridgebank Capital for acquisition and development funding. Bridgebank provided a six month bridging loan against 65% of the market value of the property, irrespective of the actual purchase price.
On that basis, the borrower was only required to invest 14% of the purchase price. This resulted in the borrower also having sufficient surplus cash available to invest in the conversion and refurbishment works.
Within five months, the conversion project had been completed and tenants were occupying the two new retail units. The borrower was then able to secure a long term commercial mortgage for the property, repay the Bridgebank bridging loan and move on to another new investment opportunity.