PBL 091 - Public House Conversion to Residential, Emsworth

And the answer to dp early question is now definitely NO, as it now a 6 month loan that started 4 days ago!!!

SS have just said another thread that they are aiming to improve the accuracy of this info.

No, the sale was just 10k below the market value.
In fact the same valuation report written initially for SS and dated 6th March was clearly referring to a market value for the property of 300k.

(the second report, partially overriding the initial one, was what left me unhappy as it is still not clear to me how a security sold few weeks ago at 290k can be a good security for a 304k loan....).

Sorry,
this is not a land case. It is a residential conversion of a business activity, which is not so uncommon or particularly brilliant in its plans.

It is true that a professional follows a planning permission, but it is exactly a professional that the current borrower paid for and a professional the old owner could have paid for the same reason (and then sell immediately with a planning permission).
If you think of it, the current borrower might not have put a penny of his own money 290 (buying price) + 5k (likely plans+ planning permission professional fee) and he has a loan which already now values the venue 435k...
(if this was true the borrower could not even bother with the works and sell it and in a month or two he would have made 140k net...) 

@hor1997:  There are people who make their living doing just that.  They find a property without PP that they believe would benefit from a change of use, and apply for OPP.  If they're unsuccessful, they re-sell it and lose a bit of money.  If they're successful, however, they can sell it with OPP to a developer and make a small packet for their effort.  If they're a developer themselves, they apply for FPP, obtain a development loan, do the development work, sell the result, and make a large packet.

It's a high-risk, high-reward business, and suits some people.

I don't think it's the question, that some people find opportunities, and make a lot out of planning. The question is whether this is plausibly the case in this instance; converting an upstairs flat and downstairs pub into an upstairs flat and a downstairs flat increases value by 50%.

I recently met a friend who lives and drinks in Emsworth. His publican was apparently thinking of buying the premises in question here. My friend's view is that the borrower is like a nine-bob-note, but that the property was sold for less than it was worth.

Just for information, you don't need to own the property (or indeed need to have any kind if "beneficial interest" in the property) to apply for planning permission.  anyone can apply for anything anywhere providing they pay the fees
Brian

The permission just exists.  I suppose in effect it belongs with the property.
on a side note, there is nothing to stop you applying for planning permission to run a brothel at your local vicarage (for example) and the council cannot turn it down on the grounds of it being illegal or immoral, they can only refuse it on "planning grounds" e.g. local nuisance, loss of amenity in the neighbourhood, noise disturbance, not on legal nor any other (non planning) grounds.
usual way is Developer A  pays landowner for an "option" to purchase, applies for planning permission, if it gets refused he just allows option to lapse, if it is granted he buys the land/property/whatever at the pre-agreed price.  (otherwise once permission is gained, owner could just sell to highest bidder)
HTH
Brian