Case Study · United Kingdom

Property loan for UK developers to purchase and renovate shophouse

30 July 2021

Property loan for UK developers to purchase and renovate shophouse

Rikvin Capital provided a property loan to UK developers for the purchase and renovation of a shophouse in London. With the loan, the developers were able to acquire the property at a favorable price and carry out necessary upgrades to increase its value. The loan enabled the developers to make their project a reality, adding to their portfolio of successful real estate investments. Rikvin Capital’s flexible and efficient funding solution helped the developers achieve their goals and grow their business in the competitive London property market.

Related: Read about when Rikvin Capital provided a short-term loan for shareholders to complete the buyout of a partner

  • Location: London, United Kingdom
  • Market Value: £5,500,000
  • Loan Amount: £3,300,000
  • Loan-to-Value: 60%
  • Duration of Loan: 12 Months
  • Payment Schedule: Rolled Up Interest Payment
  • Asset Type: Shophouse with Commercial and Residential units
  • Completion Time: 1 week

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FAQ

Can Rikvin Capital fund the purchase and renovation of a UK shophouse?

Yes. The London case lent £3.3 million against a £5.5 million mixed-use shophouse (60% loan-to-value) in 1 week, with rolled-up interest paid at the end. Mixed-use buildings with both commercial and residential elements are well-suited to short-term private financing because high-street lenders often struggle with split-use titles.

How is renovation funding structured?

Either as a single drawdown at the start (suitable for borrowers with their own working capital for staged works) or as tranched releases tied to renovation milestones. Tranched drawdowns reduce your interest cost because you only pay interest on capital actually released.

How is the loan exited after the renovation is complete?

Most commonly via either a long-term commercial mortgage on the upgraded mixed-use building, sale of the renovated property, or refinance into a buy-to-let portfolio facility if the residential units are being held for rent. The London developer used a 12-month term to give time for either route.