ianj
Member of DD Central
Posts: 656
Likes: 520
|
Post by ianj on Oct 9, 2017 17:03:23 GMT
New loan in Pending - MTBA822 going live 12:00 tomorrow.
Eighteen-month loan for £2,375,000 secured by a near-complete commercial property. The vacant possession valuation of the property is £3,800,000 giving this loan a loan-to-vacant value ratio of 62.5%. Interest rate 13%.
Loan Details states that "The borrower is an experienced commercial property developer and investor, having completed numerous projects around the UK over the last 29 years. The borrower has significant experience of acquiring buildings on a strategic basis and producing reliable income streams."
Companies House shows borrowing co.
Incorporated on - 7 July 2017 Place registered - British Virgin Islands
Sole Director (GS): Residence - Monaco Appointed - 7 July 2017 No other current or previous company history (registered under GS name), but there is a GPS (same month of birth) recorded as director of two other companies based at the same Straffordshire address, both registered in BVIs.
|
|
stokeloans
Member of DD Central
Posts: 402
Likes: 485
|
Post by stokeloans on Oct 9, 2017 17:08:24 GMT
I'll tell you what I know,it's not much unfortunately The building,a former nightclub,laid empty for a number of years.Approx 18 months ago work started but no one knew what it's intended use was going to be. They gutted the place....they found a full size snooker table buried under a dance floor in the lower level. It was announced about a year ago it was going to be an antique centre with multiple occupancy but it also appeared work had stopped.The exterior looks finished but I pass by most days and have only seen activity on one occassion this year when the doors were open and some guys were taking stuff in.Maybe they were working behind closed dooors. It was supposed to have opened by now, there was an article in the local paper,The Stoke Sentinel but I can't find it. There is a similar site a few miles up the road,Dagfields,it's going to be a city version of that as I understand it. Not sure it's the best area for an antique emporium of this size but I hope it takes off.Could bring a lot of people into the area Oh and I used to frequent it every weekend when it was a nightclub
|
|
archie
Posts: 1,865
Likes: 1,860
|
Post by archie on Oct 9, 2017 17:13:41 GMT
They gutted the place... .they found a full size snooker table buried under a dance floor in the lower level.+ Oh and I used to frequent it every weekend when it was a nightclub I think I've spotted a connection.
|
|
stokeloans
Member of DD Central
Posts: 402
Likes: 485
|
Post by stokeloans on Oct 9, 2017 17:18:14 GMT
They gutted the place... .they found a full size snooker table buried under a dance floor in the lower level.+ Oh and I used to frequent it every weekend when it was a nightclub I think I've spotted a connection. No,the snooker table was buried way before my time. I went for the ladies lol
|
|
m2btj
Member of DD Central
Posts: 631
Likes: 772
|
Post by m2btj on Oct 9, 2017 17:47:54 GMT
I think I've spotted a connection. No,the snooker table was buried way before my time. I went for the ladies lol The SM has come to life this afternoon following the announcement of this new loan. I suspect investors are trimming portfolios in order to diversify into this loan. Reassuring to see a local (Manchester) firm providing a valuation....I wonder if stokeloans has a view of the value?
|
|
|
Post by mrclondon on Oct 9, 2017 17:49:43 GMT
If they are opening for trade early November the lack of pre-launch publicity is perhaps concerning. Their own website is a fairly basic single page presumably aimed at potential retail tenants, and both their facebook and twitter pages have a post dated late March "Opening soon". Nothing recent in the local media that I can see.
The loan description says "The underlying loan agreement with the borrower is an interest only agreement, where interest is retained for the first month (pre-trading) and paid monthly thereafter with capital paid at the term." Admittedly they have the office tenant to provide some cashflow, but its going to take time to ramp up the occupancy of the retail floors.
I would have preferred to see a monthly cashflow for the first 6 to 9 months, or some commentary as to how the interest will be financed until occupancy is sufficeintly high to service the interest.
|
|
|
Post by bobthebuilder on Oct 9, 2017 17:51:48 GMT
Am I missing something here? Rate to lenders is 13%, so cost to borrower, say, 16% (admittedly an assumption that may inflate MT’s profit margin). Loan amount £2,375,000 x 16% = £380,000 p.a. Projected rental income is £514K, but after utility bills, management costs, insurance and ongoing maintenance this is expected to fall to £400,446 p.a. (P25 of the valuation report). That doesn’t leave much of a margin for voids in a distinctly specialised target market for tenants and it’s stated that the licences are on a rolling one month basis, which doesn’t seem to provide much security of income. In the absence of serious reassurance I’m worried about debt serviceability on this loan.
|
|
hazellend
Member of DD Central
Posts: 2,363
Likes: 2,180
|
Post by hazellend on Oct 9, 2017 17:53:19 GMT
I like the look of this one. Hopefully the super sleuths won't find anything alarming!
|
|
fp
Posts: 1,008
Likes: 853
|
Post by fp on Oct 9, 2017 17:59:47 GMT
My only concern too bobthebuilder. It would be interesting to know the actual property value based on no rental income, as if the loan goes sour, this will be what we need to rely upon.
|
|
GeorgeT
Member of DD Central
Posts: 1,322
Likes: 1,576
|
Post by GeorgeT on Oct 9, 2017 18:08:35 GMT
My only concern too bobthebuilder . It would be interesting to know the actual property value based on no rental income, as if the loan goes sour, this will be what we need to rely upon. This scenario appears to have been provided, i.e. the vacant possession value as copied below. £3,600,000 - Market Value as existing assuming full vacant possession and assuming a sale to be completed within 180 days.
|
|
fp
Posts: 1,008
Likes: 853
|
Post by fp on Oct 9, 2017 18:14:44 GMT
My only concern too bobthebuilder . It would be interesting to know the actual property value based on no rental income, as if the loan goes sour, this will be what we need to rely upon. This scenario appears to have been provided, i.e. the vacant possession value as copied below. £3,600,000 - Market Value as existing assuming full vacant possession and assuming a sale to be completed within 180 days. I think this is taking rental income into account, which to be fair is not guaranteed income.
|
|
stokeloans
Member of DD Central
Posts: 402
Likes: 485
|
Post by stokeloans on Oct 9, 2017 18:19:41 GMT
No,the snooker table was buried way before my time. I went for the ladies lol The SM has come to life this afternoon following the announcement of this new loan. I suspect investors are trimming portfolios in order to diversify into this loan. Reassuring to see a local (Manchester) firm providing a valuation....I wonder if stokeloans has a view of the value? Not really my area of expertise....and judging by some of the valuations we see on p2p loans nor the valuers !!!
|
|
dovap
Member of DD Central
Posts: 467
Likes: 410
|
Post by dovap on Oct 9, 2017 18:20:38 GMT
and relies on info from the borrower (unchecked aiui)
now where have we seen that before ............
|
|
Nomad
Member of DD Central
Posts: 755
Likes: 513
|
Post by Nomad on Oct 9, 2017 18:21:04 GMT
Projected rental income is £514K, ...which depends on finding and retaining dealers for 409 "retail units". In a former life I owned an antiques centre and keeping my 70 units tenanted with rents received on time was no small matter...
|
|
stokeloans
Member of DD Central
Posts: 402
Likes: 485
|
Post by stokeloans on Oct 9, 2017 18:21:12 GMT
My only concern too bobthebuilder . It would be interesting to know the actual property value based on no rental income, as if the loan goes sour, this will be what we need to rely upon. This scenario appears to have been provided, i.e. the vacant possession value as copied below. £3,600,000 - Market Value as existing assuming full vacant possession and assuming a sale to be completed within 180 days. [br Who would buy it in its current configuration though ?
|
|