MERA has provided a £1.25m facility to fund the acquisition of a 50-acre former commercial glasshouse site near Hitchin, Hertfordshire.
The 24-month facility was agreed at 70% LTV against the £1.8m purchase price. The site was acquired with vacant possession and comprises two bungalows, five acres of glasshouses previously used for commercial farming and around 40 acres of farmland.
Leo del Rosso (main picture), associate director at MERA, led the transaction, which was the lender’s first with the client. The deal was introduced by James Wyllie of Montpelier Private Finance.
The combination of residential, commercial and agricultural uses required MERA to assess the potential of the different parts of the site separately, including the glasshouses, bungalows, outbuildings and farmland.
PLANNING OPPORTUNITIES
The facility funded the acquisition, with the borrower planning to bring the site back into use in stages. The proposals include letting the glasshouses, refurbishing and letting the two bungalows, and refurbishing and subdividing the commercial outbuildings into smaller units for local occupiers.
In the longer term, the owner intends to explore planning opportunities for additional commercial space, including the potential redevelopment of part of the glasshouse site.
The acquisition comes against a difficult backdrop for UK commercial glasshouse operators, which have faced pressure from high energy costs in recent years. Rising heating costs have affected the viability of year-round growing and contributed to specialist commercial sites being left unused.
“Getting comfortable with the opportunity quickly took proper diligence.”
Del Rosso says: “Sites that combine residential, commercial and agricultural uses under one roof don’t fit a standard lending box.
“As our first deal with this client, getting comfortable with the opportunity quickly took proper diligence rather than a rate-card approach.
“James Wyllie at Montpelier Private Finance was a great partner in bringing the deal to us, and it’s exactly the kind of regional, multi-faceted transaction we want MERA to be known for.
“We’re looking forward to supporting the borrower as their letting and development plans for the site progress.”
David Merson at gunnercooke advised MERA on the legal work, while Katherine Ilett at Savills provided the valuation.
