Deal Round-Up November 2021

Throughout November, our team at Cornerstone Commercial Finance continued to provide unparalleled service, with over £5 million funding to our clients across various sectors, from supported living to leisure.  

Head of Complex Funding secures £2.85 million loan to enable Cheltenham residential development | £2,850,000 Commercial Portfolio Loan

Having operated a business from the Battledown area of Cheltenham for over 25 years, our client, Tim Fry Landrovers, was keen to develop one of the units of land it currently used for storage – bringing it in keeping with the development that has taken place around them.

After successfully gaining planning permission to build houses on the half acre site, Tim turned to us to help secure a £2.85 million commercial portfolio loan which would allow the section of the site to be developed for residential use.

With the existing bankers holding a charge over this section of land, they were seeking full proceeds from the development in reduction of their debt. This represented an estimated value of £1 million, against their book value of £400,000.

Read the full case study >

Commercial Investment Loan | £975,000 

A highly respected Cardiff-based entrepreneur approached us to secure funding after a proposed partnership with another investor did not materialise. With just 15 days ahead of contract exchange and a 10% deposit at risk, we were tasked with securing a lender for our client within just over two weeks. 

With the property priced at £1,475,000, our client was seeking as close to £1million as possible in funding. Through Haydn and Ian’s working relationship with Cambridge & Counties Bank, an agreement was obtained between the lender and client to fast-track the valuation ahead of the credit underwriting. 

The valuation was promptly conducted, and credit backed terms were agreed within 14 days, allowing the contracts to be exchanged on the date originally required. Following all necessary legal work, completion took place within the six-week deadline. Our team also secured the client £130,000 in funding through the Group’s bridging funder, Cornerstone Capital, to support the main transaction.

Commercial Mortgage | £825,000 

Our valued client has a successful track record within the high-end holiday-let sector. 

As part of an ongoing project including multiple properties, our client returned to us to refinance the completed second property to repay the development funding and release capital to move on to the site’s next project. 

Through our strong working relationship with YBS Commercial and our clients’ proven demand coupled with sound projections, an £825,000 commercial mortgage on a 25-year term was approved. Our client is now in a strong position to develop their next property in readiness for Summer 2022. 

More details are coming soon…

Cornerstone secures loan for Cardiff office investment | £630,000 Commercial Mortgage

Two existing clients approached us looking to acquire a three-story office building located in Cardiff Gate Business Park.

With the property priced at £900,000, we were tasked with securing funding for our clients’ newly formed company, GLJ Properties, within ten weeks. The offices to be purchased were also partially let, and retaining the existing tenants was desired.

After discussing the options available with several funders, our team proceeded with Recognise Bank after agreeing on favourable terms and its commitment to complete within ten weeks.

Read the full case study >

Commercial Mortgage | £514,500

Having purchased a vacant public house and land in Exeter, our client initially developed the top two floors into a 7-bedroom unit, catering to young adults transitioning from foster care into independence. 

Once the development was completed, our client approached us to separate the first and second floors and refinance to replay the development funding and release capital for future site developments. 

This project was our clients’ introduction into the supported living sector, meaning no sector-specific history could be used to secure a loan. Therefore, we utilised a projection-led approach when liaising with the funder and demonstrated our clients’ success across several sectors. Despite some challenges regarding the site security, we secured a £514,500 loan for our client in readiness for their future plans.

Cornerstone Commercial and Allica Bank complete five-week deal for Welsh recycling centre | £194,756 Commercial Mortgage 

Following a personal referral, our client approached us to purchase a local recycling centre, paired with a strong tenant and rental yield. 

To ensure we met the timescales, we approached our well-trusted contacts, Danny McMurdo and Joanne Hitchborn, at Allica Bank. We also relied on our close working relationship with Victoria Humphries at HCR Law to complete the legal process promptly.

Working with our clients’ buy-in and agreement as our priority, we worked as quickly as required. Together, our approach sealed the deal within five weeks, from receipt of the decision in principle to completion.

Read the full case study >

Commercial Mortgage | £180,000 

A pub-owner turned to us to remortgage the property they had bought during lockdown. The payment for the freehold was on a deferred consideration basis, and the clients’ cash flow was becoming negatively impacted. 

Our client did not have a strong account history, with the pub only open and trading for nine months before approaching us. This, in combination with the lack of lender appetite within the hospitality sector, brought several challenges to the deal. 

To clear the deferred consideration and reduce monthly repayments from £3,750pcm to £1,536pcm, a £180,000 commercial mortgage was secured on a capital and interest basis over a 25-year term. As a result, our client now benefits from an improved cash flow, enabling them to improve the property to offer an Airbnb service, facilitating future growth and increased income.  

Commercial Mortgage | £147,500 

With three existing commercial investment properties under their belt, our client approached us looking to purchase another building that was currently tenanted by another company within the gambling sector. 

Due to the tenants’ sector, several lenders had already declined the deal before the client got in touch. The deal also brought complexities as an element of the deposit was gifted, and the property was down valued. 

Using our knowledge of the market, we approached InterBay Commercial from the outset with a sighting credit paper to ensure that they were comfortable with both the tenant type and a proportion of the deposit being gifted. Although the property was down valued from £245,000 to £215,000, our client had sufficient funds to proceed with a purchase price of £225,000. The fast-paced work of the commercial team saw the deal complete on the agreed timescale set by our client. 

Commercial Mortgage | £85,000 

Our leisure-sector clients turned to us when looking to purchase their trading premises when the opportunity arose from their current landlord. However, due to the impact of the pandemic on their trading performance as a business, along with the small loan size and directors age, lender appetite was limited. 

Utilising our clients’ pre-pandemic performance coupled with their businesses’ performance since re-opening and projections, we were able to secure our clients an £85,000 commercial mortgage through our relationship with the Development Bank of Wales. This required working with our client’s accountant to collate 12-months’ worth of cash flow forecast and a sensitivity analysis on these projections. 

The 13-year term of the loan will support the purchase of the property, enabling our clients to trade from the premises for the foreseeable future, helping our clients achieve a long-term ambition for their business. We also arranged insurance to ensure our client and the lender are sufficiently protected.