Arc & Co. has successfully closed a £4.7m loan for a new development in Macclesfield, featuring sustainability-focused construction.
- The 2.5-acre project will include 15 homes, a farm shop, and versatile office spaces to foster community and local business.
- A strategic 70% loan-to-gross-development-value approach was adopted, with a 20-month term and competitive interest rates.
- The developer, with a strong Northern history, switched to using a broker for this venture, valuing expert guidance.
- Sam Beaumont of Arc & Co. played a crucial role in navigating the loan’s complexities and securing favourable terms.
Arc & Co., a capital advisory firm with a focus on specialist finance, has orchestrated a significant £4.7 million development loan for an innovative project in Macclesfield. This development, sprawling over 2.5 acres, is designed to align with modern sustainability priorities, aiming to enrich the local landscape with 15 meticulously planned new homes. Additionally, part of the project involves setting up a farm shop dedicated to supporting local vendors, coupled with flexible office spaces crafted to energise both private businesses and co-working groups.
The financial structuring of this project is notable for its pragmatic approach, implementing a 70% loan-to-gross-development-value (LTGDV) framework. This strategy ensures a balanced financial burden and offers the project a competitive edge with a 5.65% interest rate, bolstered by current base rates, over a 20-month period.
An intriguing facet of this development loan is the shift in how the developer—a family-run business with extensive regional experience—managed financing. Traditionally working directly with lenders, this project marks their inaugural collaboration with a broker, specifically Arc & Co. Sam Beaumont, the adviser, introduced a stretched senior loan option that replaced the typical senior facility paired with a mezzanine loan. This decision streamlined the process, cutting down additional fees and reducing third-party involvement, ultimately facilitating a smoother transaction.
Throughout the negotiation, several adaptations to the deal structure were required to meet the evolving needs of the development. Beaumont noted the lender’s practical stance, which was pivotal in clinching the deal successfully. He expressed enthusiasm for the outcome, highlighting the value added through their expertise and the robust relationships forged during the transaction process. Beaumont remarked on the exhilaration accompanying the negotiation for this esteemed development and his anticipation for its completion.
Arc & Co.’s adept handling of complex development finance has set a high standard, carving a path for future collaborations.
