Avamore Capital closes £13 million part-built development loan
By David Craik -
Lender Avamore Capital and broker Crystal Specialist Finance have completed a record breaking £13 million loan against a London property.
The project, based in St John’s Wood in the capital and which was only at foundation level when it was introduced will form nine luxury apartments.
It is the largest deal that Crystal has ever introduced and one of Avamore’s most significant transactions to date.
Avamore said that despite the level of complexity surrounding the case its use of its flexible award-winning Finish & Exit product smoothed the process for its client.
According to the Avamore website Finish & Exit is designed for projects which are part complete. This means they are not eligible for a traditional developer exit because there are works remaining on the site.
This could be where the developer has either run out of their existing development finance facility and so there are insufficient funds to complete the project, or the developer was relying on sales processed to fund the project which have not come in.
In the case of the St John’s Wood property the highly experienced borrower had faced unexpected delays during the early stages of the build.
With the term end of its existing development loan with another lender looming, Avamore and Crystal worked closely to “present a supportive and competitive offer.”
The lender and the broker, who have previously worked together on part-built development cases, decided that as the project had already stalled, saving time and money was key for the client.
Avamore structured the loan to include a £600,000 release of capital against some of the existing works which had not been funded by the previous lender. This helped both the borrower’s cash flow and liquidity.
In addition, Avamore worked with a valuer and monitoring surveyor already familiar with the scheme saving time prior to loan completion.
Avamore said it took comfort from the quality of both existing suppliers making the transition between lenders seamless for the borrower.
Furthermore, Avamore, working closely with Crystal and the borrower, granted timeline concessions around the loan documentation.
Despite the challenging nature of the loan the Avamore underwriting team, drawing upon their expertise in part-built development, took time to understand the borrower’s experience, circumstances and quality of works done to date to “maintain its solution driven ethos”.
Andreas Yianni, Relationship Manager at Avamore, said:
“I’m delighted that we have once again proven to be the go-to lender for part-completed developments.
I’m proud to be part of a team talented enough to complete deals as complex as this.
I’m also grateful that Crystal have once again put their trust in us to get the job done.”
Adam Tauber, Development Finance Specialist at Crystal Specialist Finance, added:
“We are thrilled that our fast and effective collaboration on this milestone deal, and our mutual commitment to service excellence, has produced a stress-free and seamless outcome for the client.
It’s a winning formula and we look forward to replicating it for other borrowers in the future.”