Redwood Bank has completed a £403,410 loan for a mixed-use property in Liverpool after structuring the borrower’s trading business and property investment under an OpCo/PropCo arrangement.
The specialist bank provided the loan against a property valued at £565,000, comprising four residential flats above a commercial unit occupied by the borrower’s own business.
The transaction required Redwood to address the fact that the borrower was effectively both landlord and occupier of the commercial element. As no rent was being paid on the owner-occupied unit, a market rental figure had to be established before the deal could proceed.
Redwood worked with the borrower and broker White Rose Finance Group to agree a market rent for the commercial premises and put a formal lease in place between the property owner and trading business.
This enabled the transaction to be structured on an OpCo/PropCo basis, separating the operating company from the property-owning entity while allowing Redwood to assess both elements of the case.
Jane Hand, regional development manager for the North and Midlands at Redwood Bank, says: “This was a great example of how OpCo/PropCo structuring and semi-commercial lending can sit alongside each other in more complex cases.
“By taking the time to fully understand the trading business and property elements of the deal and the customer’s long-term objectives, we were able to deliver a solution that supported both their immediate needs and future investment plans.”
The loan completed at 71.4% LTV in under four months, with rental income forming the main component of affordability.
The case was introduced by White Rose Finance Group, which worked with Redwood throughout the transaction.
David Fine, client and projects manager at White Rose Finance Group, says: “Redwood’s personal approach and willingness to look at the detail of a case is what sets them apart.
“The team took the time to understand the structure and worked collaboratively throughout, which gave us and the customer confidence from the outset.
“Having direct access to experienced decision-makers made a real difference in getting the deal over the line.”
