Bristol City Centre
FUNDING LOAN TO ASSIST A BUILDING PURCHASE AND DEVELOPMENT
A developer/investor required a loan to assist in the purchase and development of a former night club building located in Bristol city centre.
The borrower initiated, planned and executed off site factory built self-contained student accommodation pods. However, the challenge for the developer was the installation of the completed pods into an existing city centre building.
In addition, the developer had to comply with the often-competing requirements of the public, local businesses, town planners, highways and building control departments, to ensure a safe and minimal disruption outcome.
Garhill was chosen as the preferred lender due to our expertise and ability to understand and support developers through the purchase, development and exit process, encompassing simplicity to complex developments. We fund the construction of new build and refurbishment projects. On this project we applied our ability to recognise a profitable scheme and a professional developer.
A key element of any Garhill loan is our skills and systems to manage and control risk through solicitor led loan documents, registered legal charges, personal guarantees with directors of financial substance and project and financial monitoring throughout the duration of the project.
The units have been let to students, the investment created refinanced on a long term mortgage and Garhill repaid.
BRIDGING LOAN FOR THE FEES REQUIRED TO SELL A PIECE OF LAND
A developer owned a parcel of land in a residential area of Solihull, forming part of the garden attached to his family house.
A national housebuilder agreed to pay in excess of £1M for the garden land, subject to obtaining planning permission for a residential development. The housebuilder paid £100,000 non-refundable deposit, to be held within a solicitor’s escrow account.
The landowner wished to pay professional fees and costs related to the development of the land and needed a loan to meet these costs. The landowner approached his personal and business bankers, where the accounts had been held for over 30 years, for a loan of £70,000. The application was rejected on the basis the land did not have planning permission at the time of the loan application.
After consulting with his finance broker, the landowner approached Garhill. Despite the land not having planning permission and even if the planning application was rejected, we took a pragmatic commercial view recognising that the loan was particularly well secured with the borrower to receive in excess of the Garhill loan and agreed to lend the £70,000 required.
Planning permission was granted four months after the loan was advanced, the housebuilder paid the agreed contract sale price and Garhill was repaid, one month later.
Balsall Common, Coventry
BRIDGING LOAN FOR A FARM HOUSE PURCHASE AND RESTORATION
A partner in a local firm of Chartered Accountants and his wife agreed terms to buy, for their family home, a farm house in need of renovation together with a disused barn and 17 acres of agricultural land.
The purchase price was £1.2m and the loan applicant required a bridging loan of £750,000 to be repaid when their existing family house was sold and the farm house was refurbished, after which he and his wife could obtain a mortgage on the property being purchased.
The loan applicants were investing their own cash and the personal net assets and the property being purchased, provided a secure loan position for Garhill.
The £750,000 loan was completed in January 2019.
The security was valued at the purchase price of £1.2m and the loan of £750,000 equated to a loan to value of 63%. Interest was rolled up and paid when the loan was redeemed in June 2019.