West One Loans, the largest privately funded bridging lender in the UK, has completed a £800,000 loan on a project to develop a student hall of residence in London. The loan was drawn down in two stages; one at £550,000 and the other at £250,000.
The loan was secured against a 15 year lease which developer, The Camden Collective had on a derelict property in Camden. The finance provided by West One Loans was used to renovate the building, which had been gutted by fire in 2007.
The Camden Collective, which had already spent £700,000 on the property, was able to complete the project. Refinance via a mainstream lender, borrowing against the freehold value which stands at £8,000,000 post completion, will now be possible.
The property on 261 Camden Road comprises 50 rental apartments to be let to international students and professionals and features an on-site concierge who can arrange dry-cleaning, the delivery of overseas newspapers, source international delicacies, and organise foreign exchange at preferential rates. The development also includes 24 hour security, apartment cleaning, and a weekly linen change.
Reza Merchant, director of The Camden Collective says, “Being in Camden this property was ideally located in Camden for London’s students and young professionals, and proved to be a very different prospect from the soulless new builds that are the mainstay of student accommodation in London. This building was once a bustling hostel in the heart of the borough and even though it had been left derelict and fire damaged for five years, it had a wealth of personality. But there was no way we could borrow the cash from a mainstream lender. The property was a burnt out shell when we found it. Fortunately, West One Loans had the vision and understanding required to help us get to this stage. It was only with the help of Duncan and the rest of the West One Loans team that we were able to make the project happen and restore it to its former glory.”
Duncan Kreeger, chairman of West One Loans comments: “This was a classic case of banks and building societies taking a very short-term view and refusing to offer a loan, despite the developer having a great track record, because of the complexity of the project. Fortunately, with our broader perspective we could see its enormous potential and, using our investor based funding model, coupled with our knowledge base behind structuring complex deals, West One Loans engineered the perfect solution. With the finance we provided, The Camden Collective, was able improve the property, and then re-finance at a lower rate over a longer period. What’s more, the development is now fully let and is bringing in £685,000 a year, 15 per cent more than the initial projections. It was a very successful outcome all round.”