Short-term lender Glenhawk has completed an £11.7m refinance loan for a newly built purpose-built student accommodation (PBSA) development in Aberdeen, Scotland.
The two-year loan replaces an existing development finance facility for the scheme, which was experiencing temporary under-occupancy issues. The borrower required additional time to appoint a new managing agent and implement strategies to increase occupancy levels and rental income.
Loan structure
Glenhawk structured the £11.7m facility with an interest arrangement designed to align with projected letting improvements. The financing allows the borrower to execute their occupancy recovery plan while managing cash flow during the transition period.
Chris Daly, managing director of structured real estate at Glenhawk, said: “The borrower needed to work with a lender that has experience within the PBSA sector, and can get to grips with the nuances and unique challenges this form of investment can provide.”
Student accommodation market
The transaction highlights ongoing challenges in the Scottish student accommodation market, where new schemes can face occupancy pressures during initial letting phases. Aberdeen’s student housing sector has experienced fluctuations in recent years, influenced by changes in university enrolment patterns and competition from alternative accommodation providers.
The deal represents Glenhawk’s continued activity in the PBSA refinance sector, targeting borrowers requiring short-term bridging solutions while stabilising asset performance.
