Atom bank has provided a £2.35 million commercial mortgage to finance the reopening of a hotel in Mayfair, London, which had been closed for more than five years following the Covid-19 pandemic.
The deal was arranged by Gindy Mathoon, senior mortgage and protection adviser at broker Create Finance, with legal work completed by Kimberly Crossman, commercial property solicitor at Square One Law.
Lending challenges in hospitality sector
The transaction faced significant obstacles, with approximately nine lenders rejecting the application before Atom bank agreed to proceed. Lenders cited concerns about the hotel sector and the borrowers’ limited experience in the industry as reasons for declining the deal.
The hotel’s new owners had struggled to secure funding to reopen the property. Atom bank conducted extensive due diligence before structuring a deal that enabled the hotel to resume operations.
Spencer Ford, business development manager at Atom bank, said: “The hotel sector is a complicated one, and that alone can put off some lenders, but it’s an area in which we have built a formidable reputation. Similarly, other lenders struggle when the borrower doesn’t have extensive experience, but as a lender on the side of SMEs, we prefer to focus on ways to make deals work rather than find reasons to walk away.”
Commercial property financing
Mathoon, who operates as an appointed representative of Optimum Elite Network, said the case had been rejected outright by around nine lenders before Atom bank took it on. “This deal had a few quirks and hurdles, as a result I had a straight ‘no’ from around nine lenders,” she said.
The transaction adds to recent commercial property financing activity, following similar deals in the development finance sector and refinancing of multi-unit blocks.
The hotel is now operational following completion of the financing arrangement.
