Cohort Capital secures £20m for central London serviced apartment refinance

Cohort Capital has completed a £20m senior loan secured against a prime luxury serviced apartment building in Soho, central London.

The 24-month facility refinances an existing private bank loan and provides additional equity release against a freehold comprising 22 luxury serviced apartments at 37 Golden Square, Soho.

The sponsor — a high-net-worth individual — required refinancing after the incumbent private bank determined the asset no longer met its lending criteria, despite the property’s strong operational performance.

The borrower acquired the property in 2017 before undertaking a comprehensive redevelopment.

The 27,125 sq ft freehold property is arranged over eight floors and includes 22 apartments, including a triplex penthouse spanning the sixth to eighth floors, featuring two private terraces and dedicated lift access.

Cohort said the asset has been demonstrating strong operational performance supported by institutional-quality management.

The lender’s financing provides the sponsor with time to arrange long-term debt while releasing capital to support wider business activities.

Matt Thame, founder and CEO of Cohort Capital, said: “Increasingly, we are seeing private banks step away from high-quality assets because their lending criteria have changed or because they’re focusing lending on clients with larger assets under management.

“This dynamic is generating significant demand for flexible alternative capital to fill refinancing shortfalls, as experienced borrowers seek certainty of execution despite owning assets that are performing strongly.

“Serviced apartments and hospitality assets have demonstrated strong fundamentals and are managed by increasingly sophisticated operators.

“At the same time, parts of the traditional BTL market are becoming more challenging as regulation evolves, creating opportunities for professionally managed operational assets.

“This is an area where we expect to deploy significantly more capital over the coming years, recognising that underwriting operational real estate requires specialist expertise to evaluate underlying performance and forward business plans properly.”

So far this year, Cohort Capital has originated £208m across 35 transactions with a forward pipeline in excess of £400m.

Recent transactions include a £40m equity release against a Grade II-listed freehold with consent for a luxury private members’ club and hotel in London’s West End, a £22m cross-collateralised bridge facility over four residential assets in prime central London and Surrey, and a £9m acquisition and VAT bridge in Edinburgh.