TAB has completed two linked bridging facilities totalling £4.5 million to refinance existing debt on commercial properties in Poole and Bournemouth. The transactions were completed within seven days of the initial enquiry, despite what the lender described as a complex legal and beneficial ownership structure.
The first facility provides £3,477,000 against a commercial property in Poole, valued at £5,225,000, representing an initial loan-to-value (LTV) ratio of 66.5%. The second provides £975,000 against a commercial property in Bournemouth, valued at £1.5 million, with an initial LTV of 65%. Combined, the facilities have an initial LTV of 66.2% against a total property valuation of £6.725 million.
Asset management requirements
Both loans run for 24 months, with interest retained for the first month and serviced thereafter. The properties require different asset management approaches. The Poole property is an office building with three vacant upper floors, and a large tenant recently exercised a break clause. The valuer identified potential to improve the asset and considered it could be sold within approximately six to nine months.
The Bournemouth property combines commercial and residential accommodation. Its ground floor extends to more than 17,000 sq ft but has been vacant since 2023. The valuation assumes the space will be subdivided into four units, requiring capital expenditure and an extended letting period.
The transaction involved a complex legal and beneficial ownership structure, which TAB incorporated into the borrowing and security arrangements. The primary exit strategy is to sell the properties after reletting, though the borrower could alternatively seek approval for residential conversion under permitted development rights.
OPES Financial Partners, a whole-of-market mortgage broker, introduced the loan. Matthew Davies, co-founder of OPES Financial Partners, said: “The Poole property has significant vacant space and needs active asset management. The Bournemouth property has a large vacant commercial element and a more involved letting strategy.”
Quarterly repayment structure
The facilities include mandatory quarterly capital repayments to reduce the outstanding debt during the loan term. The borrower will repay £120,000 each quarter against the Poole facility and £30,000 against the Bournemouth facility, reducing the combined borrowing by £150,000 every three months. The loans are fully cross-collateralised and cross-charged, giving TAB security across both properties.
Michael Grant, head of sales at TAB, said: “We looked at the properties, the existing debt and the exit. That gave us the confidence to move quickly. The quarterly capital repayments reduce the debt throughout the term. The cross-collateralised structure also gives us additional security across the assets.”
The transaction adds to recent bridging finance activity in the commercial property sector, as borrowers seek short-term refinancing solutions for assets requiring repositioning. Similar to other alternative finance arrangements, the structure allows time for asset management strategies to be implemented before longer-term refinancing or sale.
