Cohort Capital has completed a £20m senior loan secured against a prime luxury serviced apartment building at 37 Golden Square in Soho.
The 24-month facility refinances an existing private bank loan and provides additional equity release against a freehold comprising 22 apartments.
The sponsor – a high-net worth individual – required a refinancing after the incumbent private bank determined the asset no longer met its lending criteria, despite the property’s strong operational performance.
The borrower acquired the property in 2017 before undertaking a comprehensive redevelopment to create the luxury serviced apartment scheme, which is arranged over eight floors.
Matt Thame, founder and CEO of Cohort Capital, said: “Increasingly, we are seeing private banks step away from high quality assets because their lending criteria have changed or because they’re focusing lending on clients with larger assets under management. This dynamic is generating significant demand for flexible alternative capital to fill refinancing shortfalls, as experienced borrowers seek certainty of execution despite owning assets that are performing strongly.
“Serviced apartments and hospitality assets have demonstrated strong fundamentals and are managed by increasingly sophisticated operators. At the same time, parts of the traditional buy-to-let market are becoming more challenging as regulation evolves, creating opportunities for professionally managed operational assets. This is an area where we expect to deploy significantly more capital over the coming years, recognising that underwriting operational real estate requires specialist expertise to properly evaluate underlying performance and forward business plans.”
