United Trust Bank steps in to refinance £2.7m Guildford development
08 February 2021
United Trust Bank (UTB) has agreed to refinance a £2.7m high quality apartment scheme by Clearview Developments by providing a £1.8m Sales Period Loan.
Martin Cameron in UTB’s Structured Finance team was approached by Sam Le Pard of specialist real estate finance advisory firm LEXI Finance when the original lender declined a request to extend the term of their funding. LEXI Finance needed to obtain a quick decision and completion of the refinance in order to save their client from incurring default charges and interest rates being imposed by the existing lender.
Progress on the six apartment development had been slightly set back by delays in material and fittings deliveries and utility connections caused by the Covid-19 restrictions. However, one of the main obstacle was created by the original lender suspending the release of funds during the first pandemic lockdown and requiring a revaluation of the project. This delay impacted the progression of the build once funding was eventually restored.
With completion delayed and the sales period shortened, Clearview Developments were in urgent need of an extended term to properly market the new homes and achieve projected sales values, however the existing lender had made it clear this was not an option they could consider.
Although Clearview is a new customer to UTB, the Bank’s Structured Finance team worked closely with Sam Le Pard and LEXI Finance and despite the additional challenges presented by Covid-19, quickly agreed the new facility. A swift completion soon followed giving Clearview Developments a further 12 months to market the new homes and achieve their maximum sales values.
Jason Tema, Director of Clearview Developments, commented: “The pandemic has created many additional challenges for SME housebuilders with projects being delayed for various reasons beyond our control. Lenders show their true worth when problems occur and Martin and the team at UTB have proven their ability and their appetite by quickly agreeing and then completing this facility. I’m very pleased to have formed this new relationship and I’m sure it will be the first of many successful schemes with UTB.”
Sam Le Pard, co-founder of LEXI Finance, commented: “The original lender’s inability to extend meant that we had a limited amount of time to agree the refinance and avoid running over term, risking default interest. Martin Cameron and the UTB Structured Finance team worked quickly and diligently to agree and then complete the deal, saving our client money and giving them certainty for the remainder of the project. I was particularly impressed with UTB’s flexibility when it came to balancing their appropriate risk mitigants with meeting my client’s timescales to get the deal over the line. UTB demonstrated their speed and flexibility on this, LEXI Finance’s first transaction with them. On the back of their performance with Clearview, we were very comfortable immediately introducing further deals to UTB, which have also since proceeded to complete. Our trust in UTB continues to grow.”
Gerard Morgan Jackson, Head of Structured Finance – United Trust Bank, commented: “Although new to the Bank, Jason and Sam were able to show us Clearview’s excellent track record of delivering and selling high quality homes and we were delighted to provide the funding they needed to ensure their ongoing success. We aim to build strong, long term relationships with our customers and broker partners, supporting their growth through the ups and downs of the economic cycle. I look forward to us working with Jason and Sam again very soon.”
