UTB’s Development Finance division was approached by a newly formed SPV looking for funding to acquire and develop a former bus depot site in a popular coastal town. Although a new client to the Bank, the parent company of the SPV had a strong track record of delivering successful developments including playing a significant role in a substantial regeneration scheme in London.
The initial £2.1m facility required to secure the site needed to be arranged and drawn quickly due to a strict completion deadline. The borrower risked forfeiting their deposit if the completion and this was offered on the basis of a 3-month bridging facility. During this period the borrower is due to receive funds from the Housing Growth Partnership (HGP) enabling them to repay some of the bridge. Once the facility is reduced to £1m, either from funds from the HGP or other sources, the bridge will be refinanced into a development facility.
In addition to the bridge, UTB agreed a £10m development facility up to 65% of GDV to fund the completion of the project and once fully drawn the overall LTC will be 82%.
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