CASE STUDY: Century completes landmark Bromley development loan

Century Capital have recently provided a first charge development loan to a seasoned building developer, secured against a property in Bromley. The borrower sought additional capital to refinance the initial purchase, and to provide cash flow for development works.

Loan Amount: £4,637,000

Property Value: £3,375,000

GDV: £8,500,000

LGDV: 54.6%

1st Legal Charge

Deal Overview:

The borrower will be developing the former 4-storey hotel into a large entertainment venue, with a co-working space and several food and drink outlets. Because of its complexity, this loan was structured in two tranches:

• A day 1 drawdown to support initial refinancing
• An additional sum to fund the development as it progresses

With the project’s unique requirements and more complex loan terms, Century worked closely with all parties to provide flexible financing that addressed both timeline and cash flow demands.

Challenges:

1. The borrower had a tight schedule for developments
2. Lack of comparable properties available
3. Assessing the cost was difficult for the QS and valuer

The Outcome:

Obtaining a valuation report proved to be challenging, as it was hard to find comparable properties given its unusual layout and derelict condition. Because of this, the borrower could not begin development works as early as they wanted. The combination of its commercial fit out and bespoke fixtures made assessing the cost harder for the QS and valuer, and the process was slightly slower than initially expected. However, our excellent underwriter helped to facilitate productive conversation between the two, finalising the deal as fast as possible to meet the borrower’s timeline.

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