Belgravia Gate
London, U.K.
$237,000,000
Loan Amount
$26 Million
Loan Per Unit
$3,600
Loan Per SF
Condo Inventory & Completion Financing
Lotus arranged $237 million of construction completion and inventory financing for a row of 12 ultra-luxury townhouses in London’s Golden Postcode. The financing represented one of the largest residential financings in the UK ($3,600 per SF), and one of the highest loans per unit for a condo inventory loan in Europe ($26 million per Unit).
Challenges:
The transaction represented an extremely large loan size in difficult market conditions for luxury residential due to Brexit, ongoing elections, and uncertainty related to tax reform. Lotus had to navigate around a very high loan basis, at nearly $3,600 per SF, coupled with a concentrated risk of just 12 units, reflecting a very high loan exposure of $26 million per unit.
Solutions:
Lotus’ approach of an in-depth market analysis enabled them to effectively differentiate the ultra-luxury market in order to sell the story. As lending veterans, Lotus was effectively able to address lender basis risk (including sales price & timing sensitivity, loan basis sensitivity and rental exit analysis). Additionally, complex issues were met with creative solutions, with Lotus widening the pool of lenders by engaging capital from all over the world and initiating senior / junior lender partnerships.