Challenging project has a successful and stylish outcome
United Trust Bank’s Development Finance team was approached to fund the development of a mixed-use scheme in East London.
The developers, NestEast, were seeking to undertake what would be their largest and most complex scheme to date. They put together a strong team and used contractors with whom they had previously worked.
The property was an existing two storey live/work unit which was located behind commercial properties and adjacent to a small electricity sub-station. The property came with the benefit of planning for the demolition of the existing building and the erection of a part three / four-storey mixed use scheme with lower ground floor offices and three flats on the upper floors.
The client immediately saw an opportunity to significantly enhance the currently consented scheme, however, they required bank funding towards the acquisition as well as future development costs. They also wanted assurance that if planning were to be enhanced, that further consideration could be given for what would be increased construction costs, albeit this would be set against a higher predicted GDV.
Following completion of the purchase, planning was indeed granted for a part three / four-storey mixed use scheme with B1 offices now located to the basement and three 3 bedroom flats to the upper floors, all with roof gardens and separate entrances at ground floor level.
The basement works were particularly complex given the enclosed nature of the site and proximity of the sub-station. However, these were completed diligently.
During the development, the client encountered several issues with a small number of suppliers which resulted in delays incurring additional costs. UTB continued to support the client and provided additional funding to cover the costs and overrun.
UTB also subsequently provided further equity release against the development to enable the client to purchase an additional site, which they have now sold on with planning, and UTB are in the process of providing further funding for their next scheme.
Zuzie Poskitt is the Managing Director of the developer, NestEast. She described the experience of working with United Trust Bank on this scheme.
“United Trust Bank have been a most supportive finance partner and a breath of fresh air compared to some of our previous experiences. They do so much more than just release the stage payments on time. We value their guidance based on their industry knowledge and many years of experience and they quickly became an important part of the team. Their backing has enabled us to not only complete this successful development, but also to expand our business and take on more exciting and ambitious projects.”
“This was not a ‘vanilla’ project by any means. Their flexibility enabled us to achieve beneficial planning changes, overcome supplier issues and to release sufficient equity to acquire another site. Adam and the team at UTB recognised and encouraged our desire to build high quality, distinctive and unique properties which would make them stand out in a competitive marketplace. They appreciated the thought and attention to detail which was put into the design and this has been rewarded with the creation of some stunning new homes. I very much look forward to working with Adam and United Trust Bank again on our next development.”
Adam Bovingdon, Property Development Director at United Trust Bank commented:
“This wasn’t the most straightforward of projects but we are delighted to say that the end product is excellent. The client has executed the build very well with a superb mix of modern materials that sit particularly well in this bohemian suburb of London.
“Furthermore, additional design touches such as the brickwork finished in a Herringbone style is not something we have seen before but really lifts the external appearance. The roof box windows, which house the stairs leading onto the roof gardens, brings a little bit of a ‘007’ feel to the development. These open electronically and are operated from the bottom of the stairwell.
“At UTB we understand that in housebuilding things don’t always proceed exactly as planned. However, by working closely with the client and by being flexible and pragmatic, we find we can overcome most challenges without any dramas.”