Bridging lender reports £7m month

Bridging lender reports £7m month




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This week, the heads of many top bridging lenders have been celebrating the success of May - which they claim was a record month for new business. Very few of these lenders though were willing to report the actual volume of new business completed, leaving us wondering whether May really was 'record breaking' or whether in fact it was just marginally better than April.

One lender though, was willing to share his successes with us. Jonathan Rubins, Managing Director of Alternative Bridging Corporation (ABC), gives us an inside scoop on his multimillion pound month...

B&C: So Jonathan, I’ve heard that May was a busy month for the team at ABC. Can you tell me how much business you did exactly?

Just over £7 million in new business.

B&C: Did this come from one particularly large loan or from a lot of smaller deals?

We completed three large loans and a number of smaller ones.

B&C: Why was there such a high demand?

I don’t think there is any one particular reason. Because of all the holidays we had in April, the month was somewhat dry, meaning that there were a few deals that trickled into May. That being said, we had a steady stream of business throughout May and not just in the first half.

B&C: Can you tell me about one of the larger loans, what was it for?

Yes. We financed a residential investment on Ridley Road, Hackney. The borrower came to us with a very short time frame, as he needed to close the sale quickly. He realised that the bank simply wouldn’t be able to move the funds quickly enough. We completed the loan in just six days.

B&C: How did you manage to move so quickly on the deal?

Well, luckily the borrower was organised and clearly knew what he was doing. There was a high level of professionalism on both sides. Our legal team, Teacher Stern, were able to get all of the paper work done very quickly, and all parties on the borrower’s side were ready to sit down and plan things immediately. The valuation was also in hand, so this was not an issue.

In addition, the deal was just very good! The residential investment was close to the market and the exit was clear.

B&C: We’ve been seeing a lot of talk about buy-to-let in the media at the moment. Have you experienced a lot of interest in this sector?

Yes, there has been some interest. However, we often find that the buy-to-let investors are very ‘cash’ heavy and are able to move quickly without a bridging loan.

B&C: So what were the other big deals in May?

We funded a large land transaction and an industrial investment in Gloucestershire.

B&C: Well, it’s good to hear that there are investments going into the industrial sector again.... So which market sector would you say you experience the greatest demand for bridging loans from?

The investments over £10 million do occasionally pop up, but the bread and butter of bridging is in the quarter million - £10 million transactions. These are the areas where investors are looking for bank loans but struggle to secure them quickly enough. For example, in the land investment I mentioned earlier, without bridging finance the borrower would have waited approximately three months for the funds.

B&C: And how is June looking for you?

It’s looking almost as good as May already!

 

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