FRP arranges £47.2m refinance and capex facility for Central London office refurbishment
FRP has arranged a £47.2m facility from a specialist debt fund for the refinance and refurbishment of a 58,000 sq ft office building in the City, on behalf of a longstanding client.
The facility refinances the client’s existing acquisition bridge – also arranged by FRP – and funds a significant capital expenditure programme, targeting BREEAM Excellent. The works cover a full internal refurbishment and a new top floor, for which planning consent was achieved since the original acquisition.
The loan was agreed at 78% LTC and 65% LTGDV. The margin will step down once the building is fully let.
The transaction was led by FRP’s Edward Horn-Smith, partner, and Philip Kay, Director, and marks the team’s third transaction with the client.
Speed was central to the brief, with drawdown of the refinance tranche coming only five weeks after credit approval. Elements of the development tranche are to follow the refinance with the incoming lender taking a practical approach in order to accommodate the speed required for the refinance. FRP worked directly with the principal at the specialist lender to keep the process moving.
Post-capex, the developer’s business plan targets an owner-occupier or single-let strategy, with a multi-let strategy as a fallback. Lease marketing strategy will begin once works start on site.
Philip Kay, director at FRP, said: “This is a client we know well, and the brief was clear: refinance at pace and fund the capex without losing momentum. We partnered with a provider which took a commercial approach to the more complex points, particularly relating to the top floor addition, and having a direct line to the principal made a real difference. The credit process and certainty of execution were significantly quicker than the other routes available – which is exactly what this client and this timeline needed.”