Specialist lender Cohort Capital has stepped in with a £22 mln (€25 mln) acquisition loan to an undisclosed US fund for the purchase of an office asset in west London.
The 3,716 m2 former school at Brook Green, W6 7BJ will be transformed by the developer into 33 luxury flats in a gated community.
Situated in an wealthy area of West London resilient to housing market challenges, the office to residential conversion is expected to significantly raise the asset’s value.
Cohort Capital’s lending facility saved the developer a £12 mln (€13.5 mln) deposit, as the previous alternative lender, which had offered higher leverage, pulled out of the deal at the last minute.
The loan was provided at 60% loan-to-value ratio with a 12-month term.
Matt Thame, founder of Cohort Capital, said: ‘This is another great example of where Cohort’s reliable funding and underwriting base has directly benefited the borrower market. The deal received significant attention in the short-term lending space after another funder had failed to perform at the last stage. We were able to provide certainty for the borrower by moving quickly at a lower LTV. If market turbulence continues, it’s likely we will continue to see less experienced lenders pulling out of deals, putting transactions at risk.’
Bal Sohal, chairman of Cohort Capital, added: ‘There is growing demand for stable, sensible, and quick funding – we believe certainty is good business in the current climate. We never set out four years ago to be the cheapest and highest on LTV; just to be reliable and straightforward. In addition to the reliability factor, we are typically closing deals two weeks from first enquiry – compared to banks which are taking at least 3 months to close debt transactions. We have a strong pipeline of comparable deals and are constantly looking for more suitable loan opportunities.’