An experienced property investor has secured a £1.3m loan from Redwood Bank to support the expansion of a specialist supported housing portfolio, in a deal arranged by broker Propp.

The investor, who owns a portfolio of houses in multiple occupation let to a supported housing provider, required funding to restructure and grow their holdings. The four HMOs, valued at a combined £2.055m, are tenanted by a housing company that caters to individuals with learning difficulties, mental health conditions, autism, and other care needs.

The transaction involved releasing equity from two properties in the portfolio to fund the transfer of ownership of the remaining two from personal to corporate ownership.

The structure was designed to optimise the investor’s strategy and facilitate further acquisitions in the assisted living sector.

Redwood Bank approved a £1,306,800 loan at 64% loan-to-value, on a 19-year interest-only basis with a five-year fixed rate of 6.49%.

Paul Elliott, of specialist finance comparison site Propp, which introduced the client to the lender, said the deal had unlocked strategic growth potential.

“This facility has allowed my client to secure competitive pricing on a high-yielding portion of their portfolio, and created the ability to plan strategically for further growth in the assisted living sector over the coming years,” he said.

“In their own words, ‘there is a real need for this sort of housing’ so it’s really satisfying to work with a lender like Redwood that understands the value the sector is providing to our society.”

FLEXIBILITY STANDING OUT

Elliott praised Redwood’s approach, noting the lender’s flexibility in a sector where mainstream lenders often rely on automated processes and standardised criteria.

“What impressed me most was the flexibility Redwood showed throughout the process,” he said. “There were some challenges along the way, but the team at Redwood approached each issue with a ‘can do’ attitude.”

He added that the ability for the borrower to meet virtually with the lender was a key part of the success, allowing the parties to align expectations and finalise terms efficiently ahead of drawdown.

Redwood Bank business development manager Ian Tudor (pictured), who worked closely with Propp on the transaction, said: “It was so good to be able to assist an experienced investor, introduced by a reputable broker, for the purpose of helping the care sector.”