InterBay funds £15m PBSA refinance

By Bridging Loan Directory 10th February 2025

Specialist commercial lender InterBay, part of OSB Group, has successfully completed a £15m case to refinance 65 studio flats split across two student accommodation blocks.

The blocks are located on the outskirts of a major city and serve students from a nearby Russell Group university.

Purpose-built student accommodation (PBSA) is often assumed to mean new build specifically for student use, however, this investment opportunity involved upgrading and repurposing existing stock with one block purpose built in 2019 and the other block (dating from the Victorian period) had been converted into student accommodation use.

The 65 total units have been completed to a very high specification as standard and features include 24-hour concierge, automatic blinds and solar panels.

These considerations helped achieve an EPC rating of B and contribute toward lower utility costs.

Marc Callaghan, Head of Commercial Lending, InterBay said:

“We’re delighted to have worked alongside Rob Heywood from Sirius Finance and his client on this high quality project.

The client has over 30 years’experience in student accommodation and 100% occupancy with a strong letting history.

PBSA is a sector that InterBay has actively supported for over 10 years so we’re confident in our market knowledge and expertise.

In this particular case we were able to base the finance on 75% investment value and 88% of the vacant possession valuation, meaning we were able to leverage a higher amount for Rob and his client.

Our inhouse teams worked seamlessly together to complete the case and we worked very closely with the solicitors at Paris Smith to ensure a smooth transaction journey.

It was another great team effort both internally and with our external partners.”

Rob Heywood, Senior Associate – Structured Finance, Sirius Finance said:

“We approached InterBay for a few reasons; we needed an experienced lender who could handle complexity and having already worked with Marc and the team on a number of deals, I had every confidence they could get this case over the line.

From start to finish, it was a fantastic collaboration with everyone involved, including the sales, underwriting and completions teams.

Everyone worked diligently to explore different options and their solution solving abilities are second to none.

It’s a great testament to the well established relationship we’ve built between InterBay & Sirius.”