MERA completes £3m bridging loan for London office-to-residential conversion

MERA Investment Management has completed a £3m bridging loan to support the acquisition and planned conversion of an office building with two ground-floor retail units into 21 residential flats.

The property is located on City Road near Old Street, within London’s ‘Tech City’ corridor.

Associate Director Leo del Rosso led the transaction for MERA, highlighting the lender’s appetite for funding office acquisitions and complex conversion projects.

The 18-month facility was structured at 55% loan-to-value (LTV), providing the borrower, a prominent UK-based property family, with the capital required to secure the asset while awaiting Prior Approval for residential conversion.

Given the borrower’s profile and relatively low leverage, MERA was also able to waive its usual personal guarantee requirement, allowing the transaction to proceed efficiently.

The project reflects a broader shift across London towards repurposing underutilised office space. According to research from BusinessLDN and CBRE, converting just 10% of London’s 30 million square metres of office space could potentially deliver around 40,000 new homes.

By supporting this conversion, MERA says it is helping unlock the value of secondary commercial assets while contributing to London’s housing supply.

The lender also intends to provide additional funding for development costs once the conversion plans are finalised.

Key loan details

• Loan size: £3m
• LTV: 55%
• Term: 18 months
• Asset: Office and retail to residential conversion (Permitted Development)
• Location: City Road, London

Leo del Rosso, Associate Director at MERA Investment Management, said:

“This completion highlights the value of long-term professional relationships. I’ve known the principals of this family for many years, which allowed us to move with the certainty a case like this requires.

This asset is well positioned to benefit from the growing trend across London of converting secondary office and retail space into residential accommodation.

We are seeing experienced investors increasingly unlocking value through Permitted Development.

In addition to providing the acquisition funding, we are positioning ourselves as long-term partners and expect to support the construction phase as the project progresses.”

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