United Trust Bank (UTB) Structured Property Finance has provided a £3.76m sales period facility to the Nacropolis Group to complete a time sensitive off-market acquisition.
Nacropolis is a property development company with a contemporary design led approach and a reputation for delivering high quality residential conversions of listed and redundant commercial buildings, as well as new build developments. Nacropolis has developed around London and the Home Counties for the last 50 years and are now expanding their interest into other areas of the country.
Nacropolis wished to fund the purchase of an off-market opportunity but needed to move quickly to secure the acquisition and protect their deposit. Specialist Property Finance consultant Paula Devine, working on behalf of Nacropolis, approached the Bank via mutual contact Adam Bovingdon, UTB’s head of property development.
The off-market purchase came with the benefit of planning consent but Nacropolis wished to explore alternative redevelopment angles for the site and needed a bespoke funding solution which would give them time to design, submit and achieve approval for a new scheme.
In order to provide 100% of the acquisition costs, UTB proposed a sales period facility secured by the target site and two residential schemes recently delivered by Nacropolis.
Despite the complexity of the multi-security solution, the Structured Property Finance team was able to structure the deal and obtain credit approval in less than two weeks. Following that, the valuation and legal due diligence was swiftly completed and the loan was drawn within six weeks of UTB receiving the initial enquiry.
Following completion of the loan, sales at both developments progressed well. Nacropolis subsequently approached UTB to release further equity from the developments, which was used to fund onward development opportunities. UTB approved and drew down this request within a week.
Ravi Pankhania, managing director of Nacropolis, said: “Although the site came with planning consent, we saw an opportunity for an alternative and potentially more lucrative approach. However, with other purchasers circling we needed to move quickly and we chose to exchange straight away.
“With several developments already in play we had plenty of assets and wanted to utilise these in order to complete the purchase. It was at this point we reached out to Adam Bovingdon of UTB. Adam was very happy to bring in the Structured Property Finance team and their response was immediately positive and encouraging.
“Gerard Morgan Jackson and Martin Cameron immediately got to grips with our requirements and circumstances and structured a complex facility very quickly. The result of Martin’s hard work was that we completed our purchase on time and within around six weeks of starting the process. I was impressed and delighted with the outcome. I’m sure this is the start of a successful relationship between Nacropolis and UTB.”
Devine added: “This was a great example of a skilled and knowledgeable team delivering a complex structured facility on time and on brief. Ravi and the Nacropolis team are always on the look-out for their next successful project and it was important that the deal was structured in such a way as to allow securities to be released once agreed parameters were met. This would allow Nacropolis to employ their equity on other opportunities as and when they appear. Gerard and Martin took a pragmatic and commercial stance, determined to put a deal together which would suit my clients as well as mitigating risk for UTB.”
Gerard Morgan Jackson, head of structured property finance – United Trust Bank, commented: “In the current property market, it’s not uncommon for investors to identify value-add opportunities but find themselves unable to seize them due to various hurdles. In this instance it was a combination of timing and liquidity.
“At UTB we believe in supporting our clients in finding a way to overcome any obstacles. On this occasion we were delighted to work with Nacropolis in structuring a bespoke funding solution providing exactly what they required by leveraging the existing Nacropolis portfolio. Furthermore, we were able to make the funds available within just 28 working days of receiving the initial enquiry.”
