Arc & Co has completed a £1.2m refinance of a complex BTL portfolio.
This refinance was secured on a five-year fixed rate from a challenger bank at 5.89%.
The client’s company structure — which held five residential apartments — included a majority shareholding by foreign nationals, with the portfolio held within a wider group structure.
Additionally, two of the properties were within a UK special purpose vehicle (SPV) registered to a Mauritian company.
The five assets being remortgaged were spread across two SPVs with ownership split among five shareholders, the majority of whom were based in South Africa.
The transaction involved navigating cross-border shareholdings and restructuring at the SPV level to meet the lender’s KYC requirements and maximise leverage.
Dieter Kerschbaumer, asset finance advisor at Arc & Co, was able to leverage his network and find a lender that could work with the unique setup.
The lender agreed that the two assets in the SPV owned by the Mauritius company could be transferred to the other SPV already held by the UK group.
The ownership at the SPV level was restructured, with the Holding Co holding a 96% shareholding and the two UK directors holding a 2% shareholding each. This reduction made the lender comfortable accepting a minority shareholder waiver agreement by the South African directors.
The lender also allowed Lightfoots to act as dual representative on the legal documentation. As Lightfoots had previously acted for the clients on a separate transaction, they had all client information on record, which enhanced the speed of the legal process.
“It was great to structure a solution with the borrowers that enabled a smooth transaction and unlocked leverage that wouldn’t otherwise be available in a limited market for foreign nationals,” said Dieter.
“The borrower’s proficiency and bank’s commercial approach were key to the successful end result.”
