“From the outset, this was about more than simply refinancing an existing facility, it was about protecting the client’s position and creating a clear route forward”
– Corey Dennis – Arc & Co.
Specialist finance broker Arc & Co. has structured a £4.7m funding solution across three interconnected facilities, helping a property investor stabilise a pressured portfolio and fund two further acquisitions.
The transaction, led by senior broker Corey Dennis (pictured), was triggered by an urgent need to refinance a buy-to-let facility approaching maturity. The underlying asset, a 16-unit residential block held under a single freehold, had recently been downvalued by £400,000, placing additional strain on leverage and significantly narrowing the available refinancing options.
Aggregate valuation proved the turning point
Recognising that speed and structure were equally critical, Dennis arranged a £2.9m bridging facility at 75% loan-to-value, calculated against the aggregate market value of the individual units rather than a discounted block valuation. The distinction proved pivotal. By underwriting the asset on an aggregate basis, the lender could provide sufficient leverage despite the revised valuation, keeping the refinance viable.
With the main residential asset stabilised, Arc & Co. moved to the second phase: restructuring two additional assets and releasing equity to support further acquisitions. Two five-year fixed-rate facilities were arranged across semi-commercial and commercial properties, totalling just over £1.9m, both structured at 73% loan-to-value against vacant possession value. Pricing was secured at 6.25% and 7.6%, respectively.
Equity release funds two new development sites
The facilities were arranged at 73% gross to vacant possession value with fees added on top, maximising leverage and allowing the client to extract capital efficiently. The funding repaid the existing lender in full while generating enough equity to support the acquisition of two new development sites.
The coordinated three-part transaction illustrates how a structured approach to property refinancing can resolve an immediate pressure while keeping a longer-term growth strategy intact.
What this means for property investors facing down valuations
Down valuations on residential blocks are a recurring challenge in the current lending environment, particularly where lenders apply a single block valuation rather than assessing individual units.
This case demonstrates that approaching lenders willing to underwrite on an aggregate basis can materially change what is achievable on leverage, even after a significant reduction in assessed value. For investors managing mixed portfolios under time pressure, structuring facilities in coordinated stages can also unlock equity that a single refinancing transaction would not.
“From the outset, this was about more than simply refinancing an existing facility, it was about protecting the client’s position and creating a clear route forward,” said Corey Dennis. “Despite the down valuation, it was key to approach a lender that would accept the aggregated value of the individual units.”
“This ensured the existing facility could be redeemed and provide stability. We were then able to refinance the wider portfolio, release additional capital and support the acquisition of two new development sites. It’s a strong example of how the right funding strategy, delivered in stages, can turn a pressured situation into a platform for growth.”
With down valuations continuing to affect leveraged property portfolios across the UK, structured multi-facility refinancing is likely to remain in demand among investors managing complex or time-sensitive positions.
Brokers able to identify lenders with flexible underwriting criteria, particularly around valuation methodology, will be increasingly well placed to add value where conventional refinancing routes fall short.
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