FRP Real Estate Advisory has completed a £21m acquisition loan with Shawbrook to support the purchase of a Cardiff office building, despite market volatility affecting lending conditions during the transaction.
The commercial acquisition facility was arranged by FRP Real Estate Advisory for the purchase of a modern office asset in central Cardiff with strong environmental credentials.
The transaction was led by Corey Dennis, senior broker at FRP Real Estate Advisory, who managed the process from inception through to completion, coordinating with the lender and external advisers.
The deal completed during a period of market uncertainty, with interest rate expectations shifting in response to geopolitical tensions. To maintain the viability of the acquisition, the funding structure was revised to a five-year term incorporating a two-year fixed rate.
According to FRP, the change was designed to provide greater certainty over borrowing costs and support the borrower’s cash flow planning.
The advisory firm also sought to maximise leverage for the client and worked alongside Newmark on the valuation process. The final structure was agreed on the basis of the lower of 75% loan-to-value against vacant possession value or 65% against market value.
Dennis says: “Sudden market changes from global conflicts created additional complexities. However, with close coordination between all parties, we managed the evolving lending conditions, pricing adjustments, and transaction timelines.
“By pivoting to a fixed rate, we preserved the client’s cash flow in a volatile market. I am delighted we were able to successfully deliver this strategic acquisition for the client within the required timeline during these conditions.”
Russell Gaynor, structured real estate senior analyst at Shawbrook, adds: “We are delighted to have supported a new-to-bank client with a £21m acquisition facility for this high-quality, modern office in central Cardiff with a BREEAM Excellent rating.
“Backed by an experienced sponsor, the facility was structured not only to fund the acquisition but also to provide the client with a 2-year fixed rate to support cash flow planning, supporting the client’s wider growth ambitions.
“Welcoming a new client to Shawbrook on a transaction of this calibre, delivered alongside FRP, Newmark, and Brecher, reflects exactly the type of business we are looking to support through our Structured Real Estate proposition.”
Legal advice on the transaction was provided by Brecher LLP, with valuation services undertaken by Newmark UK.
