Loan Amount:
£1,400,000
Property Value:
£2,000,000
LTV:
70%
Even where property investors have vast levels of experience under their belt, there could still be scope for expanding into new markets. This was illustrated by borrowers who turned to us for help with an investment in a commercial property. They aimed to convert the property and change the use.
Coming to us via a company, the investors already owned multiple investment properties and wanted to expand their portfolio. The buyers turned to us for quick funding, which couldn’t be acquired through traditional, high street lenders. With the permissions dependent on getting funds in quickly, our underwriter got to work, making sure everything was accounted for ahead of drawdown.
Three clear exit strategies provided us with peace of mind
Being experienced BTL landlords, the investors wanted to move into the commercial/development scene and had multiple strategies for doing so. Their overall goal was to uplift the property’s value following a redevelopment, and they laid out three clear plans to assess.
We found that the borrower had a clear vision for their investment, which could be very lucrative down the line. Additionally, to further support the loan, our underwriter obtained evidence of the offer to purchase from a third party. As multiple, sensible, plans were in place, along with knowing that the investor had plenty of experience, we felt comfortable in issuing the loan.
Commercial property conversions could present exciting new opportunities
Renovating or converting commercial property has become a hot topic in recent months. As the pandemic raged on, several businesses struggled. Offices and shops across the UK ended up empty or boarded up and many developers focused on these spaces for their residential potential.
With a lack of supply in the residential market, commercial investors may be eager to get involved, but do not know where to start. Afterall, turning closed department stores into modern flats may be easier said than done. Fortunately, we’ve broken down the key things to know about commercial-to-residential conversions here.
Further reading:
- Featured Product: Commercial & Semi-Commercial Bridging Loans
- Explainer Video: Commercial Bridging Loans
- Tool: Bridging Loan Calculator
- Report: The importance of the local high street – A post-pandemic outlook
- Blog: How to convert commercial property to residential assets and why should you bother?
- Blog: What are exit strategies? Everything you need to know
