Michael Grant

How bridging finance could help save the high street



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The fallout from 2020 is yet to be seen in full in terms of the economic impact, but it has been clear for some months now that the hospitality and retail sectors are among the hardest hit.

As you would expect from businesses that rely on getting people through the door, they are most vulnerable during extended periods of lockdown and restrictions.

The government has said it is committed to doing all it can to shore up these sectors, but even they admit they cannot save every job.

There is hope on the horizon as the vaccine continues to be rolled out, but it can’t come quickly enough for the restaurant and pub trades, which bring people into our town and city centres and breathe life into our high streets.

With mainstream lenders unable to provide the support that’s needed in the timescales required, there is an opportunity for bridging finance to offer a lifeline to those in need.

We have already seen a significant increase in the number of enquiries from hotel owners and similar businesses looking for short-term finance to get back on their feet.  Of course, the challenge is managing the exit route if there is no prospect of income being generated in the short to medium term. 

But, thanks to the vaccine programme, confidence is growing that by the end of the first half of 2021 things will be back to normal. Or at least a new normal. So, if your exit plan is based on a two-year loan term, there’s good reason to believe your business will be back on its feet within that time.

Let’s face it, given how long most of us have had to stay away from our favourite pubs and restaurants, there is going to be a lot of pent-up demand to get back in there come the summer.

The other big change for our town centres is going to be the amount of retail units and commercial space coming onto the market, as the trend for working from home is likely to continue. 

Businesses simply won’t need or want to pay for large empty offices if the majority of staff are working remotely or from small co-working hubs closer to their homes. 

That is going to open up some great opportunities for investors and developers looking to convert residential spaces in central locations. This has the dual benefit of addressing the ongoing housing shortage and making profitable use of space on the high street that may otherwise become derelict.

Of course, when it comes to Covid-19, we’re not out of the woods yet, but the first couple of months of 2021 has seen a lot to be positive about in terms of new opportunities and investment.

The key, more than ever, is going to be flexibility and being able to work closely with brokers and master brokers with a lender which can move quickly on the opportunity — but also to agree the exit route, so the whole process is managed from the same central point.

At West One we have always been quick to adapt to change, whether that’s political uncertainty over Brexit, or the coronavirus crisis. We’re able to take a negative situation and find a positive way forward, which ensures we keep lending, and our brokers and clients get their deals over the line.

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