FRP Real Estate Advisory has structured a £1.1m refinance of a completed office-to-residential conversion in Reading, releasing equity to fund the developer’s next project.
The facility was arranged at 75% loan-to-value across four lenders, including MT Finance and Landbay.
The property was divided into seven leases to meet the lenders’ individual requirements. These comprise six residential leases and one for a ground-floor commercial unit, while the freehold remains in a holding entity.
All four facilities had to complete simultaneously.
The client, an experienced property refurbishment contractor, self-funded the conversion of a former hairdresser’s with offices above. The scheme was completed earlier this year before the contractor instructed FRP Real Estate Advisory to release equity from the finished development.
The funds will support the client’s next office-to-residential conversion in the South East.
Office-to-residential schemes carried out under permitted development rights delivered 5,154 new homes in England in 2024-25, according to figures from the Ministry of Housing, Communities and Local Government. However, completions have declined steadily since 2020 as the stock most readily suited to conversion has been used up.
Gareth Briggs (pictured), associate director at FRP Real Estate Advisory, who also advised the client on an earlier transaction, says: “Coordinating four lenders across seven leases so everything was completed on the same day was a genuine structuring challenge, and it took real patience from everyone involved to get there.
“Each lender had its own requirements, so aligning the leases, the freehold structure and the timing took some careful planning behind the scenes.
“It’s great to be working with the client again after a previous deal together, and I’m looking forward to helping them get moving on their next project.”
Legal advice on the transaction was provided by Jury O’Shea LLP.
