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Post by overthehill on Apr 23, 2021 13:04:23 GMT
Does anyone understand the exit strategy and can the development start before this loan is repaid ? I only see mention that the borrower intends to sell rather than develop.
Thanks
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boundah
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Post by boundah on Apr 23, 2021 13:10:56 GMT
Not exactly flying: 24% gone at Zero+10m. Still, given the loan size maybe not surprising. I'm happy to wait it out.
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p2pfan
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Post by p2pfan on Apr 23, 2021 13:16:50 GMT
Usual tie to ACF. Parent co has charges to an SPV Yes, the parent company has a charge from ACF since 2019. How would this rank compared to the "Corporate Guarantee from Group Company" that Ablrate advertises? Would it take priority over Ablrate's charge? I've suffered quite a number of situations now where loans like this default and only then does it come to light that the security protections advertised by the borrower to get funding were worthless in reality. Seems like a great loan overall, but I am so hesitant to say that with the ratio of these type of developments that become highly problematic. On the flip side, this is a borrower without a long term track-record for such large and complicated developments. 25%/£343k of the loan snapped up at the time of posting this and has stalled on that level for a few minutes.
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p2pfan
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Post by p2pfan on Apr 23, 2021 13:22:09 GMT
They are paying 21% for this 12 month bridge. 11% to us, 10% to ABL. 11% might slow the take up but I think the poor underwriters will go hungry. ABL obviously deserve to be well rewarded, but taking nearly 50% of the share for themselves when we are the ones putting our money on the line seems extraordinarily high!
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Post by Badly Drawn Stickman on Apr 23, 2021 13:45:16 GMT
I am seeing no mention of the exit strategy, which presumably would be a development loan. Sounds like development would not be started until the revised planning has been considered. I suspect a development loan would be raised elsewhere. Arguably the 'value' is the planning permission more than the building (except as foundations) Underwriters swoop in after 7 days, trickle out again slowly blocking the SM for some time. Handy for the shops, although never having been there I am not sure if it is thriving or charity shops with the odd poundland. Competition for the 12 parking spots would be an entertaining web cam watch. Have not yet found the purchase price. when i was searching earlier using Eastgate shopping centre development i came across a story from last summer (Essexlive i believe) which basically said the shopping centre had been hit by being dated & Lakeside etc and is being developed but with more housing and amenities.So kind of looks like this project will be slap bang in the middle? I had a quick look after your first post. Although in truth I had just assumed it to be the 'every town/city everywhere' situation that it is. So many places in need of renovation from the 'blight' at the end of the last century. The danger is that there is always a need and always great plans but seldom the finance to make it happen. Clearly this one will be an exception to the rule and be a great success.
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agent69
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Post by agent69 on Apr 23, 2021 14:08:06 GMT
Usual tie to ACF. Parent co has charges to an SPV Yes, the parent company has a charge from ACF since 2019. How would this rank compared to the "Corporate Guarantee from Group Company" that Ablrate advertises? Would it take priority over Ablrate's charge? I've suffered quite a number of situations now where loans like this default and only then does it come to light that the security protections advertised by the borrower to get funding were worthless in reality. Seems like a great loan overall, but I am so hesitant to say that with the ratio of these type of developments that become highly problematic. On the flip side, this is a borrower without a long term track-record for such large and complicated developments. 25%/£343k of the loan snapped up at the time of posting this and has stalled on that level for a few minutes. Given the failure of other experienced developers, this could be a blessing in disguise
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Post by ablrate on Apr 23, 2021 14:28:08 GMT
Yes, the parent company has a charge from ACF since 2019. How would this rank compared to the "Corporate Guarantee from Group Company" that Ablrate advertises? Would it take priority over Ablrate's charge? I've suffered quite a number of situations now where loans like this default and only then does it come to light that the security protections advertised by the borrower to get funding were worthless in reality. Seems like a great loan overall, but I am so hesitant to say that with the ratio of these type of developments that become highly problematic. On the flip side, this is a borrower without a long term track-record for such large and complicated developments. 25%/£343k of the loan snapped up at the time of posting this and has stalled on that level for a few minutes. Given the failure of other experienced developers, this could be a blessing in disguise There will be a first charge over the asset as the primary security, so the debentures are, essentially belt and braces.
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blender
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Post by blender on Apr 23, 2021 14:32:40 GMT
They are paying 21% for this 12 month bridge. 11% to us, 10% to ABL. 11% might slow the take up but I think the poor underwriters will go hungry. ABL obviously deserve to be well rewarded, but taking nearly 50% of the share for themselves when we are the ones putting our money on the line seems extraordinarily high! To be fair, the Ablrate fees are 3% up front and then the monthly equivalent of 7%. There will be costs involved which might be part of the 3%. But overall Ablrate should take £140k from this project in a year. On the other hand I think there will be some big hits to Abl's monthly income elsewhere, say if the holiday camp prepays or the car loans drive off a cliff. Ablrate does not put up cash, but it does take a risk to income by taking its fees monthly.
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ptr120
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Post by ptr120 on Apr 23, 2021 15:50:14 GMT
ABL obviously deserve to be well rewarded, but taking nearly 50% of the share for themselves when we are the ones putting our money on the line seems extraordinarily high! To be fair, the Ablrate fees are 3% up front and then the monthly equivalent of 7%. There will be costs involved which might be part of the 3%. But overall Ablrate should take £140k from this project in a year. On the other hand I think there will be some big hits to Abl's monthly income elsewhere, say if the holiday camp prepays or the car loans drive off a cliff. Ablrate does not put up cash, but it does take a risk to income by taking its fees monthly. As interest is retained and paid monthly, I think it reasonable to assume that their 'monthly' fee here is also 'retained', so I don't think the risk to their fees is there in the first 12 months. On the other had, the risk to capital is all ours, and there are several loans including shipping containers, breweries and aircraft for disassembling that have already dissapeared over the edge of a cliff!
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ilmoro
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'Wondering which of the bu***rs to blame, and watching for pigs on the wing.' - Pink Floyd
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Post by ilmoro on Apr 23, 2021 16:27:45 GMT
Usual tie to ACF. Parent co has charges to an SPV Yes, the parent company has a charge from ACF since 2019. How would this rank compared to the "Corporate Guarantee from Group Company" that Ablrate advertises? Would it take priority over Ablrate's charge? I've suffered quite a number of situations now where loans like this default and only then does it come to light that the security protections advertised by the borrower to get funding were worthless in reality. Seems like a great loan overall, but I am so hesitant to say that with the ratio of these type of developments that become highly problematic. On the flip side, this is a borrower without a long term track-record for such large and complicated developments. 25%/£343k of the loan snapped up at the time of posting this and has stalled on that level for a few minutes. The security is the first charge & debenture. The CG is not secured so would rank behind any charges against the parent. It and the PGs should be ignored when assessing risk, nice to have but not to be relied on.
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criston
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Post by criston on Apr 23, 2021 17:29:10 GMT
Good to see Ablrate securing 0.583% per month service fee (£8162) as these type of loans require professional monitoring to protect our funds.
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blender
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Post by blender on Apr 23, 2021 17:43:06 GMT
To be fair, the Ablrate fees are 3% up front and then the monthly equivalent of 7%. There will be costs involved which might be part of the 3%. But overall Ablrate should take £140k from this project in a year. On the other hand I think there will be some big hits to Abl's monthly income elsewhere, say if the holiday camp prepays or the car loans drive off a cliff. Ablrate does not put up cash, but it does take a risk to income by taking its fees monthly. As interest is retained and paid monthly, I think it reasonable to assume that their 'monthly' fee here is also 'retained', so I don't think the risk to their fees is there in the first 12 months. On the other had, the risk to capital is all ours, and there are several loans including shipping containers, breweries and aircraft for disassembling that have already dissapeared over the edge of a cliff! True, but we have an interest in the viability of Ablrate. This one is a nice little earner, but some of the more recent ones have been 4% pa fees. This model gives Ablrate a stake in the continued performance of loans. Unless the Funding Suckers model is preferred - up front fees, neglect, failure, administrators hoover up.
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Post by Ace on Apr 26, 2021 13:16:28 GMT
For those (like me) that thought the platform fees on this one were a bit high, the fees on today's loan (158) are eye watering. 10% upfront platform fee, plus the equivalent of 10% platform annual monitoring fee, and 14% to lenders... ouch! And still it flew off the shelves instantly; heavily influenced by the AF's borrowing record methinks.
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KoR_Wraith
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Post by KoR_Wraith on Apr 26, 2021 13:19:04 GMT
For those (like me) that thought the platform fees on this one were a bit high, the fees on today's loan (158) are eye watering. 10% upfront platform fee, plus the equivalent of 10% platform annual monitoring fee, and 14% to lenders... ouch! And still it flew off the shelves instantly; heavily influenced by the AF's borrowing record methinks. I suspect there's very few outfits with which to finance such assets, gives Ablrate a strong negotiating position in such loans.
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p2pfan
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Post by p2pfan on Apr 26, 2021 13:28:20 GMT
For those (like me) that thought the platform fees on this one were a bit high, the fees on today's loan (158) are eye watering. 10% upfront platform fee, plus the equivalent of 10% platform annual monitoring fee, and 14% to lenders... ouch! And still it flew off the shelves instantly; heavily influenced by the AF's borrowing record methinks. Yes, my eyes popped out when I saw those figures. Mr F is going to have to make a lot of money to service those rates!
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