As Britain gears up for the Olympic Games this summer, the East End of London looks set to be a hot spot for sales in the year ahead, with huge bridging loans already giving a well needed boost to development projects near the Olympic Park.  

Montello Bridging Finance, a bespoke London-based bridging lender, has just announced the provision of a £1.3 million loan for a ‘moth-balled’ development project in Hackney. The loan will provide much needed funds so that returns can be maximised ahead of the expected demand for property during and after the lucrative Olympic Games this summer.   

The finance facility, with completely flexible draw-down tranches, will allow the site which currently has three terraced houses and two commercial properties to be redeveloped with no exit fees or penalties and competitive interest rates.

Managing Director of Montello, Christian Faes, gave B&C the insight into the deal… 

“The deal is for £1.3 million, but the original loan advance was for just short of £500,000. The deal allows the borrower to draw-down on the facility in tranches of £100,000 or more, as and when the borrower requires the funds for the development.

“The story behind the development was that it was originally started by the borrower's late husband. He passed away, and work on the development was stopped. As the onset of the credit crisis unfolded, the wife was more focussed on the family business than completing the development. For some time it remained 'moth-balled' and simply too hard. With our facility the borrower has now been able to pick the project back up, and to ensure that they are able to capitalise on the sales opportunity leading up to the Olympics.”

Whilst Montello has provided a conservative LTV in this instance, Christian promotes common sense deals such as this one, which will provide great returns for their clients. He added: “We understand that we are not perceived as a development lender in the marketplace…Whilst development funding is not a core business for us, we are certainly able to do these sorts of deals. I imagine that we will be doing many more deals like this in the future.”

Christian also commented on the overall positive impact of the Olympic Games on the bridging industry as a whole and told us that the agents he works with have already experienced a particular spike in sales for the East End.