Not displaying correctly? View in browser       Acuitus Auction Finance   Commercial property for real estate investors       Portfolio finance options       Commercial and Residential Portfolio owners faced with a partial or complete loan renewal or refinance have more options open to them than they may think. A portfolio borrower will normally have an offer from their existing bank, unless their bank has changed lending strategy. It can seem like the easy option to renew a portfolio loan with your existing bank but it may not be the most suitable type of finance to meet an investor’s objectives. When looking at a refinance, investors should look at what is important to them out of the following options:   ■ Interest rate margin   ■ Short or long- term loan   ■ Interest-only, partial or full amortisation   ■ Loan-to-value   ■ Floating, partial fixed rate or full loan fixed-rate   ■ Cashflow   The next factor to take into account is the underlying portfolio as its nature may have changed since the previous loan was secured. If lease profiles have changed or reduced it may not meet the existing lenders criteria to the same extent. Lenders regularly amend their lending criteria as they move into and out of markets. Loans that were taken out in the period 2010-2014 were frequently designed to favour the lender rather than the borrower. During the past two years new lenders have come in to the market, old lenders have returned or created more flexible loans and these loans can now favour the borrower more than before. If you are starting to look at either renewing an existing facility or refinancing for equity release, you can discuss your loan objectives with Acuitus Finance to see if you can tailor a loan to suit your needs rather than the lenders.

Bridging Finance       This has often been seen as an expensive form of finance, which allows property buyers to move quickly to secure properties with a short buying period. Typically, bridging finance has been used for properties with a 1-2 month completion period. However, it has always been a premium product: as recently as ayear ago, bridging finance could cost between 1-2% per month. That situation is now changing and the cost of Bridging Finance has been reducing rapidly with different types of loan products being created to meet gaps in the property finance marketplace. Bridging Finance can now be secured from as little as 0.5% pcm, which is close to smaller loans from Clearing Banks, which can cost 4-5% over base. Compared with some Challenger Banks it can be a similar price or sometimes cheaper. Competition is increasing with numerous new lenders forcing existing lenders to accept lower returns. The main difference of course is the speed of credit approval which can be 24 hours and the limited due diligence required for the loan, which is due to the bridging lender’s principal focus being the property and clear report on title, rather than the full borrower position. New Bridging or Short-term loans are now available for the following purposes:   ■ Development Site purchase, either when a site has no planning permission, has existing permission which the developer wishes to enhance or a holding period until a developer secures a contractor and confirms costs.   ■ Development Finance where funding can be available for 75% of the site purchase and 100% of the development costs with rolled up interest.   ■ Refinance of a completed development, to repay the development loan, which creates a new 12-18 month marketing period, which allows developers to maximise profits without a quick sale being necessary.   ■ Buying and asset managing a vacant or low occupancy commercial property, which can include capital expenditure facilities.   ■ Unlocking equity from an existing asset, or using an existing asset as additional security for a new purchase.   ■ Proof of funds for new purchases with competitive private treaty properties.   ■ Buying properties at auction, remove the stress of trying to get your own bank to complete within six weeks when banks are now geared to 3 month turnaround times.   Bridging Finance is evolving to fill finance gaps, moving at the speed of the property market and providing flexibility for investors and developers when they are buying, asset managing or developing properties.           Contact Us       To discuss these new products or to access any of the lending covered in the Finance Review below, please contact Stuart Buchanan: +44(0)7879 432868, +44(0)20 7034 4850, or email stuart.buchanan@acuitus.co.uk           Finance Review       Key finance market features:   ■ Low fixed interest rates   ■ Interest rate margins reflect loan size and quality of the asset   ■ Finance available for primary and secondary sub five-year lease terms   ■ Higher loan-to-values for low-yielding commercial investments with strong covenants   ■ Finance available for offshore companies   ■ Prime residential investment loans at higher LTVs   ■ HMO and apartment block finance available   ■ 90% loan-to-cost finance for development   ■ Lower interest rates for development finance   ■ Pension fund finance available           Commercial Investment       Short-term lease investments have been difficult to finance until very recently. Recently several lenders have become more flexible about providing loans for both single tenants and multi let short lease terms. Single let investment properties with 3-5 years until lease expiry or tenant break option can be financed. Multi let investments with leases which have an average WAULT of 3 years can be financed, sometimes even shorter. Pricing depends upon the size of loan:   ■ £20m plus from 1.4% margin   ■ £10-20m from 1.7% margin   ■ £5-10m from 2% margin   ■ £1-5m from 2.25% margin   ■ £250-999k from 3% margin           Residential Investment       Several lenders are offering very attractive terms for residential portfolio investors. Loans of up to 75% LTV with a 20-year interest-only term and pricing of 2.99% over the BOE base rate are available. The loans have lighter debt service requirements than clearing banks which increases the loan size.           Development Finance       The development finance market is becoming very competitive, there are a number of new lenders coming to the market. In addition existing lenders have been updating their terms to become more competitive. Cheaper development finance from 3.25% over base is available up to 60% loan-to-cost. It is possible to get development finance at 80% of costs for 6-6.5% interest rate at 65% GDV. For developers looking for up to 90% loan-to-cost interest rates start at 8.5% to 11%. Acuitus Finance has been involved with several lenders in designing their new or revised products, these new terms will initially be available through Acuitus Finance, before a wider launch. Finance at 75% loan-to-cost is available for larger developments of £30m-£100m.             Disclaimer   The contents of this email and any attachments are confidential. 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