Arc & Co. has arranged a £3.4 million buy-to-let facility with Quantum Mortgages to support a developer in Worthing, enabling the refinancing of existing bridge and mezzanine loans and the retention of part of a larger residential conversion.
The client had previously converted a former office building in the seaside town into 120 residential flats. While the original plan was to sell all of the units, slower market conditions prompted a shift in strategy.
16 of the flats were retained as a build-to-let investment to generate ongoing rental income, with eight already pre-let to tenants.
The retained properties were transferred into a new special purpose vehicle (SPV) through individual leases, allowing the developer to secure a dedicated buy-to-let facility at an appropriate loan-to-value ratio.
Arc & Co. oversaw a revaluation of the 16 flats to support the required leverage, achieving a 74% net LTV and facilitating the full repayment of previous lenders.
The result is a self-contained, income-generating portfolio held within a simplified capital structure, giving the client flexibility to manage the asset as market conditions evolve.
Zouhair Mihramane, national account manager for the South East and West at Quantum Mortgages, said: “It was a pleasure working with Gareth from start to finish on this deal, whereby the applicant was looking for a guaranteed exit on a large development.
“As is the case with multiple units involved, there were many moving parts but nothing, through the assistance of the broker, valuer and conveyancer, we could not overcome.
“Overall, a great outcome for all parties, and I look forward to Quantum and Arc & Co. doing more business in the immediate future.”
Gareth Briggs (main picture), head of residential UK at Arc & Co., added: “This deal underscores how measured structuring and alignment between lender, adviser and sponsor can unlock value even when exit conditions are difficult.
“Quantum were supportive throughout, and we’re pleased to deliver a solution that balances security and flexibility for our client.”
