Funding for Development of 6 Retail Units in Glasgow
Our clients came to us looking to fund a commercial development project for 6 retail units in Glasgow, and required £540,000 for the build costs. The land was initially valued at £320,000 with a GDV of £1.3 million. Whislt our clients were inexperienced developers, they had subcontracted the work to experienced contractors.
Lowry Capital structured the funding in line with our clients schedule of works and and provided 4 separate advances to totalling £540,000. The 6 retail units had pre-agreed leases to companies which included a Spar, Subway and a Pharmacy.
The client is now in the process of arranging a long term commercial mortgage on the property, and will retain it within their portfolio due to the high yields it will provide.
In addition to the high rental yields, the property has increased in value by £400,000.
“Whilst it’s true that the client had no previous development experience, experienced contractors had been instructed. The figures clearly showed this was a viable and profitable project. We provided funding in stages as the project progressed and its value increased. By drawing down funding in line with their schedule of works, the clients were able to keep there finance costs to a minimum and maximise their profits (£400,000).The property is now almost complete with tenants in place.
The client will generate a significant profit/valuation uplift and a very strong rental income from the blue chip tenants.“
See more images of the development in progress below...
Before Conversion Works
Funding Stage 1
Funding Stage 2
Funding Stage 3
Funding Stage 4