A large Villa near Monaco on the French Riviera had planning permission to convert into a boutique hotel. The loan request originated from the owner of the Villa whom we had worked with in the past on arranging a bridging loan on a property in London. They needed a bridging loan to refinance an existing mortgage and release additional funds to assist with the refurbishment of the property. The loan amount was €5 million with an estimated property value of €8 million.
The client was a resident in Dubai and had experience owning hotel assets. He had also secured a strong hotel operator. The client had enough income to service monthly interest on the bridging loan. Servicing interest would allow the borrower to stretch the loan to value to allow maximum equity release.
Problems to Solve
The main issue we faced was finding a lender who still had the appetite to fund this type of hotel development. Due to the Covid 19 pandemic, many lenders have pulled out of the hotel lending market. There are still a number of lenders in the hotel market but the cost of these mortgages are not as cheap as they were two years ago. Silver Oak Capital has a number of relationships with these niche lenders who can structure a bespoke mortgage to suit the borrower situation.
We were delighted to present the following solution:
€5 million loan
62.5% Loan to Value
0.55% per month
24 Month Terms
Interest Serviced Monthly
1.50% Bank Fee (Shared with Silver Oak Capital)