Whitehall Capital Fund (‘Whitehall Capital’ or ‘the Company’), the specialist commercial and residential property bridge financing fund, is delighted to announce that it has completed a £750k loan for a portfolio of flats valued at £1.1m, located in the area of Little Switzerland, Birmingham. The three properties are all three-story buildings in a single terrace dating back to the early part of the 20th century.
Whitehall Capital has deemed the risk profile for the property to be moderate/low. The loan has a tenor of 12 months with an interest rate of 1% per month. Covenants include that the Loan to Value (‘LTV’) ratio must not exceed 70%.
The Company has completed multiple loans in the region, with its success being driven by competitive prices, readily available capital and therefore fast and efficient turnaround times which result in many of the developers being repeat customers. Previous regional transactions include £1,85m for a residential developer in Coventry, West Midlands and a £2.8m loan to a developer in Poole, Dorset.
Whitehall Capital, part of the Amram Capital Wealth Managers group, issues short term loans (normally 3 to 12 months) that are primarily secured against residential UK property although properties may be residential, commercial, mixed-use or land with planning permission. It ideally targets loans secured against properties worth between £1m and £10m. The majority of loans are in the £1-5m range. The fund only lends against properties in the UK and has a conscious bias towards big cities – London, Manchester, Birmingham etc. Its current focus area is outside central London but within the M25, but it is actively looking to be a more national lender of choice for its target market.
The loan target net return to investors is between 10% to 12% per annum. Since its establishment, Whitehall Capital has returned a net 10.4% on loans on an annualised basis.
Anthony Bodenstein, CEO of Whitehall Capital, said:
“I’m very pleased to kick off the new year with the completion of another loan in Birmingham. As this property is a House of Multiple Occupation (‘HMO’), it came with added challenges and wasn’t the most straightforward from a legal perspective, therefore I’d very much like to extend my thanks Lawrence Stephens Solicitors, especially to Avi Barr, a Partner at the Secured Lending Department, and to Nishta Camiah, Associate Solicitor, both of whom were particularly efficient and skilled in their work.
“I look forward to ushering in another year of growth and adding to our existing loan book that has delivered double-digit returns by targeting professional and established real estate investors and developers with a proven track record and with loans secured against properties primarily valued between £1m and £10m and deemed as being low risk.”
The HMO market is expected to see substantial investment during 2019, with research from Rightmove indicating that one in two property investors are currently looking to expand their portfolio in the HMO market. As the need for HMO living arrangements grows and the returns on HMOs are realised, it is likely that investors will increasingly see the potential of HMOs over traditional buy-to-let.
Nearly three quarters of investors cite the yield as the main attraction for investing in a HMO, followed by the potential for capital growth.