Octopus Property funds Stonehenge hotel acquisition with £5m facility in four days

By Bridging Loan Directory 18th December 2017

Specialist property lender Octopus Property, part of the Octopus Group, has provided Bowling Green Asset Management Ltd (“BGAM”) with a £5.0 million loan for the acquisition of the Holiday Inn Stonehenge, in Wiltshire. Completed within four days, the deal demonstrates the ongoing appetite from borrowers for the type of swiftly executed flexible financing that Octopus Property is able to provide.

The 103-bed fully serviced, purpose built hotel benefits from further planning consents for an additional 47 bedrooms and a stand-alone restaurant on the wider 2.5 acre site. The 12 month multi phased facility includes a pre-approved further advance and represented the borrower’s first use of a short term loan facility from a specialist property lender.

Located in the heart of Wiltshire, the hotel benefits from its close proximity to Stonehenge, a world famous prehistoric monument which attracts over one million visitors annually. The hotel has a wide range of amenities including modern meeting rooms, an outdoor terrace area, on-site restaurant, air-conditioned rooms and free Wi-Fi.

The loan follows on from Octopus Property’s record £80 million of new lending originated during November, as it continues to attract both new and existing borrowers to its growing Lifecycle Lending range of commercial, development and residential products.

Dominic Gibson, Fund Manager at Octopus Property, commented:

“Having been introduced the loan requirement by Steve Clinning of Howard Kennedy, one of our most trusted legal advisers, we relished the challenge of delivering the loan facility within four days. BGAM is an established property investor who required funding at a crucial moment, having been let down by a major clearing bank.

“The turnaround time speaks volumes for Octopus Property’s market leading expertise and the capabilities of our highly experienced team. By taking what was a seemingly complex loan arrangement and preventing a potential missed opportunity, we’ve again highlighted why specialist lenders are becoming more popular with borrowers who continue to be frustrated by the delays they face when applying for financing with major banks.”

Jamie Levy & Nicholas Rubin, Directors of Bowling Green Asset Management, said:

“We are delighted to announce our second branded hotel acquisition of 2017, the 103 bedroom Holiday Inn Stonehenge, for a total SPA consideration of £12.5 million, which was completed with funding from Octopus Property. The SPA price equates to an attractive net initial yield of 9.25% and is well aligned with our ongoing acquisition strategy.

“BGAM will be looking at various asset management opportunities on site, whilst continuing the good work of the previous owner. We will also be keeping the current senior management team, as well as all current employees, as we look to expand the hotel’s offerings.”

Steve Clinning, Head of Banking & Asset Finance at Howard Kennedy LLP, added:

“When we heard that this project required urgent funding, we immediately thought of Octopus Property and referred it on. It’s a great quality asset in a great location and typical of the kinds of investments and businesses that Octopus fund. We were delighted to have both introduced it and then completed the acquisition with Octopus in such a short space of time.”

Steve Clinning, Laura Brown and Katherine Langabeer of Howard Kennedy LLP acted on behalf of Octopus Property.