Commercial Mortgage Case Studies
Case Study 1 - Refinance of Office and Warehouses - £900,000
Offices and warehouse in prime West London location. Applicant company is involved in the design and installation of audio visual systems. Also, hire out equipment and manage live functions, involving the usage of 'state of the art' presentation equipment. An established, expanding and highly profitable business. The key director was looking to 'tidy up' a number of borrowings and also to undertake a small property development. Incumbent bankers were not attracted to the property development aspect.
Sterling arranged a mortgage of £900,000 on security value £1,300,000 (69%), over 15 years at bank base plus margin 1.5%. As well as delivering the client the amount of funding required, and on better terms, 'surplus' security his existing bank held was released back to the client.
Case Study 2 - Factory & Offices - £420,000
Our client was undertaking a Management Buy Out of an established £2 million turnover manufacturing business based in Portsmouth. As part of the funding package, we arranged a stand-alone mortgage on the business' freehold factory premises. This was ideal for the client as an Invoice Discounting facility was being provided by another funder, secured on the book debts with a Sale and Leaseback facility on the Plant & Machinery arranged with a third specialist funder.
The client had a range of funders, as opposed to having all his eggs in one basket.The mortgage was arranged over a 15-year term, at bank base plus margin 2%.
Case Study 3 - Purchase of Modern Factory Unit - £210,000
Purchase of new industrial unit in Northampton. Our client had been in rented accommodation but with a rent review looming was
looking to buy his own freehold unit.
The client had sufficient funds in his Personal Pension Plan to enable us to
arrange a mortgage to the Trustees of the Pension Fund. A lease was then created
to the client's trading business, with the rent charge covering the mortgage
repayment. This was a very tax efficient way of purchasing the property.
Sterling arranged a mortgage of £210,000 (70% of purchase price) over 15 years, at bank base rate plus margin 2%.
