FRP arranges £3m land bridge for gas site remediation

FRP has arranged a £3m land bridge with Secure Trust Bank Business Finance to fund remediation of a former gas works site in Tonbridge, Kent.

The works will prepare the land for a scheme of 144 apartments. The borrower plans to refinance onto development finance once they are complete.

The 18-month facility, arranged by FRP’s real estate advisory team, was structured at 44% LTV, refinancing the site and releasing equity to fund the remedial works.

The scheme comprises 52 one-bedroom, 69 two-bedroom and 23 three-bedroom apartments.

The brownfield development site is currently at the stage whereby the previous gasworks are being dismantled to make way for the construction of homes

The borrower is a developer with more than 30 years’ experience and came to the team directly as a new client.

Edward Horn-Smith, partner at FRP (pictured above), commented: “A gas works is not a site many lenders want to take on in a tough market, and the remediation is the one part of the project nobody sees once the homes are built.

“The developer had a clear plan for the land, so our job was to put that plan in front of a lender willing to take the time to understand the ground beneath it. Getting this stage right is what lets 144 homes follow.”

John O’Leary, senior relationship director at Secure Trust Bank Business Finance, added: “Nobody wants to find out what is in the ground halfway through a build, so on a former gas works the first conversation is about the remediation, not the apartments.

“With a developer who has more than 30 years behind them and leverage at 44%, we were comfortable backing that stage. It is a long way from a gas works in Tonbridge to 144 homes, but this is the part that gets the site moving.”