As part of our series of regular case study updates, read an example of a recently completed £635,000 refinance loan secured against a mixed-used property in Scotland.
Deal scenario
Our borrowing entity is a husband-and-wife-owned limited company.
Recognising a gap in the UK market for specialist African cuisine, they started their restaurant business in 2019.
Following a successful couple of years trading they decided to expand, and purchased the security property in 2021.
This comprises a ground floor and basement restaurant, with two residential flats above.
The couple have spent more than £750,000 renovating the property to a very high specification and began trading in early 2023.
The cashflow issues deriving from their refurbishment had reduced profitability to a level which made it impossible for a mainstream lender to refinance the existing loan.
As a result, they required total borrowing of £635,000 to facilitate refinancing, which includes a refinance of the existing loan and other unsecured debts.
Our lending solution
Trade for our borrowers didn’t go as planned. The cost of living crisis in 2023 had a particularly adverse impact on the hospitality industry, and forced many to close their doors.
Cash flow was a prominent issue for our borrower, who accrued debt for renovations and subsequent interest payments to their books.
Our borrower’s intention was to achieve a commercial refinance and take a more hands-on approach to improve future trade.
In this situation, we were happy to look at projected income across the two restaurants and were comfortable that the combined income across both will be more than adequate to meet the loan conditions.
Outcome
Relationship Director, Mel Howard, commented:
“Our borrowers were proven restaurant operators, yet because of the way many lenders underwrite commercial property loans, they were unable to lend based on projections.
“At Ortus, we back people with a demonstrable track record in business, and when we were able to understand the strategy it was easy to get behind the plan and provide the loan facility.”
Get in touch
If you’d like to talk to us about our commercial lending proposition and how we can help you and your clients, speak to the Relationship Director in your local office.
Contact our team today
![Richard King](https://ortussecuredfinance.co.uk/wp-content/uploads/2023/10/shutterstock_image-13.jpg)
Richard King
rking@ortussecuredfinance.co.uk
07388 993985
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Jamie Russell
jamie@ortussecuredfinance.co.uk
07741 196308
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Mel Howard
07467 188508
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Shane Donnelly
shane@ortussecuredfinance.co.uk