Specialist adviser Arc & Co. has arranged a £15.75m facility from Hampshire Trust Bank to support the acquisition and redevelopment of a former warehouse building near Old Street in London.
The funding package, secured by director Andrey Redman, will enable the purchase of the site and the delivery of two new storeys above the existing structure, alongside a full refurbishment of the current 18 apartments.
The development will bring forward new residential units within walking distance of Old Street Station, making use of offsite construction for the upper floors while internal refurbishment work is carried out in parallel.
In dense urban locations, airspace development has become an increasingly practical route to adding much-needed housing without the requirement for additional land.
HTB provided a single facility covering acquisition, refurbishment and vertical extension, allowing the borrower – an experienced private developer – to move forward without the added complexity of multiple funding lines.
The transaction completed in less than two months from receipt of valuation and legal reports.
Redman said: “This project represents the kind of creative thinking we are proud to support. From day one, we worked closely with the borrower to deliver a funding solution that aligned with both their timeline and vision.
“HTB were collaborative, pragmatic and delivered with purpose, making them an ideal partner on this transaction.”
Rob Syrett, head of origination at HTB, said the deal reflected a growing trend in the capital. “This is a strong example of the kind of deal we are seeing more of in inner London, where acquisition, refurbishment and vertical development need to be considered together,” he said.
“Structuring these elements within a single facility gives borrowers greater clarity and control. Airspace brings both opportunity and complexity, and it is essential to work with advisers who understand what a scheme needs to succeed.
“Arc & Co. brought that insight to the table and it was a pleasure to work with them again.”
Neil Leitch, managing director of development finance at HTB, added: “Airspace development is increasingly important in London, particularly when supported by modern methods of construction and a clear planning strategy.
“These projects often carry more complexity than ground-up schemes, but they can deliver real value when approached intelligently.
“Our role as a specialist funder is to bring consistency and confidence to the table so that developers and advisers can focus on execution. It was a pleasure to support this project and work in partnership with Arc & Co.”
Legal advice was provided by Galloway Hughes on behalf of the borrower, with Brechers LLP advising the lender.
