FRP has arranged £47.2m of refurbishment finance from a specialist debt fund for a 58,000 sq ft office building in the City, acting for a longstanding client. The facility refinances the client’s acquisition bridge, which FRP also arranged, and pays for a capital expenditure programme targeting BREEAM Excellent.
The works cover a full internal refurbishment and a new top floor. The client secured planning consent for the extra floor after buying the building.
The refurbishment finance was agreed at 78% loan to cost (LTC) and 65% loan to gross development value (LTGDV), and the margin will step down once the building is fully let. FRP partner Edward Horn-Smith led the transaction alongside Philip Kay, and the deal is the team’s third with the client.
Speed was central to the brief. The refinance tranche of the refurbishment finance drew down within five weeks of credit approval, with elements of the development tranche to follow. The incoming lender took a practical approach to accommodate the pace of the refinance, and FRP worked directly with the principal at the lender to keep the process moving.
When the works finish, the developer’s business plan targets an owner-occupier or single-let strategy, with multi-let as the fallback. Marketing of the lease will start once works begin on site.
“This is a client we know well, and the brief was clear: refinance at pace and fund the capex without losing momentum,” said Philip Kay, director at FRP (pictured).
“We partnered with a provider which took a commercial approach to the more complex points, particularly relating to the top floor addition, and having a direct line to the principal made a real difference. The credit process and certainty of execution were significantly quicker than the other routes available – which is exactly what this client and this timeline needed.”
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