Hotel bridging loan to renovate a listed property

Loan Amount:
£943,000

Property Value:
£1,900,000

LTV:
50%

Initial Circumstance

Danielle from Knight Frank Finance came to one of our Business Development Managers (BDM) Zahira Fayyaz, with a client enquiry for a hotel bridging loan. The main body of the commercial property was a Grade II listed building, located in North Warwickshire.

Having invested in a spa hotel during 2021, the clients were in the process of heavily renovating the property. Utilising private funds, the main body of the hotel was already completed – and had already raised the buildings overall value. Yet there were still additional works needing to be completed. The clients required fast bridging finance to complete these ongoing renovation works on the hotel.

Upon receiving the enquiry for the case, our underwriter knew she had to work quickly to support the borrowers, as many of the completed works had been privately funded. Our bespoke hotel bridging loan would provide breathing space to pay contractors and support the future renovation works without added pressure on the borrower.

However, there were some more complex aspects to the deal that we had to work around.

MFS Solutions

Working to the client’s schedule, we moved quickly to ensure the building regulations for the hotel were being upheld, due to its grading. Unlike other lenders, we underwrite from day one. This allows to us plenty of time to address any potential issues within the hotel bridging case that may arise. During the initial stages, our underwriter came across a complication within the legal structure of the lease. Our dedicated team came together, working with the broker and their client, to find a solution that worked for all parties. By taking a step back and looking at the deal from a commercial view, we were able to get comfortable with the clause in question.

Due to the nature of the asset, the BDM and MFS underwriter worked simultaneously to ensure regulations for the property were upheld. With two clients also being located overseas, our team focused on keeping communication consistent but concise for the client. Issuing one channel of communication meant the clients had a clear understanding of the matters at hand throughout the process.

Benefits

All our cases have a direct line of communication with their dedicated BDM. This case is yet another example of how MFS work with alongside their brokers, ensuring all parties are kept informed throughout the process of the deal.

Keeping everyone on the same page, particularly if there are arising complications, is imperative. Our dedicated BDM and underwriter provided the broker with support, despite the legal complication, which is where other lenders would likely have pulled out of the deal. Our bespoke approach to the hotel bridging loan enables to be flexible to suit client’s needs, and the broker was impressed with our approach, with Danielle having this to say about the process with us:

By having a team of dedicated employees assigned to the case, it was able to complete swiftly.