ABOUT THE PROJECT
This project comprises a secured loan on the development of the rooftop at 13 Lower Marsh London SE1 7RJ.
Situated on the South side of Lower Marsh and immediately to the South of Waterloo Station, Lower Marsh is close to Westminster Bridge Road with access to the West End. The property comprises a modern end of terrace 3 storey 1980's building. Having purchased the long lease of the ground floor, one of the flats on the 2nd floor and the freehold interest in the property in 2016, the borrower has since secured planning on the rooftop for the development of another apartment and sold the long lease of the ground floor to a commercial operator. The relevant Planning consent (ref. 16/02230/FUL) will provide for the construction of a penthouse suite.
RICS valuation of the existing rooftop with the benefit of planning is £295,000.
RICS estimate of the GDV based on construction of the 2 x bedroom penthouse is £950,000.
Crowd Property has agreed to lend the borrower a maximum of £450,000 to be raised in 2 phases with 1st phase being £250,000
LOCATION AND DESCRIPTION
Lower Marsh is a street in the Waterloo neighbourhood of London SE1. The street is adjacent to Waterloo Railway Station and the Old Victoria Theatre in the London Borough of Lambeth. Lower Marsh is home to the popular Lower Marsh Market and a variety of vintage shops, pubs, bookshops, art galleries and variety of coffee bars/restaurants. The property is made up of a ground floor shop, 2 apartments on the 1st floor, 2 apartments on the 2nd floor and the rooftop that has planning for a penthouse. The development of the rooftop will provide a 2 bed apartment with a floor area as follows:
81.98 sq m (882 sq ft) + private balcony of 22 sq m (237 sq).
OVERVIEW OF FINANCIALS
This opportunity is a development loan for the erection of an additional storey to provide a 2 bedroom penthouse flat at 3rd floor level. The preferred design is a modular system that needs to be ordered and paid for upfront. The delivery for this is circa 12 weeks such that it is intended the borrower will start on site 2nd week in January 2019. Build programme is expected to take 22 weeks with completion of the works expected mid May 2019.
CrowdProperty has agreed to lend the borrower a maximum of £450,000 over a 2 phased raise as follows:-
First phase raise of £250,000, from which an initial £180,000 will be released to settle some outstanding fees and order the modular system.
Based on RICS valuation with the benefit of planning of £295,000 this represents 61% LTV. The remainder of the phase 1 raise will be released on the Independent Monitoring Surveyors (IMS) verification that initial works have been executed.
The phase 2 raise of £200,000 to fund the remainder of the construction phase will be launched early in 2019. These funds will be released in phases subject to our IMS reports.
The estimated cost of works is £350,000. Fees, interest, contingencies and exit costs are estimated at £125,000.
The out turn LTV once works have been completed is £950,000 (RICS verified), and including rolled up interest and assuming full term will give a LTV of 53.29%.
The loan term will be for a term of 15 months. Once the works have completed the borrower intends to let the property, refinance to pay back CrowdProperty and hold.
As always CrowdProperty will have first legal charge documented at the Land Registry over the property.
Penthouse will be developed, refinanced and let out.
The owner of the rooftop is LM13 Projects Ltd (co. reg. no. 10928537). The owner of this company is Oriol Cervantes.
Oriol has a Masters in Business at University of Barcelona and a Masters in Finance at the Aarhus Business School. He is also competent in IT Project Management (Prince 2), IT Service Management (ITIL) and Financial Consultant skills (Ashridge Business School). Through his 20+ year career, he has worked in the private and public sectors, and in the Chemistry, Telecom, Humanitarian and Insurance fields. He is familiar with EU legislation. He has worked for international organisations including Hoechst, Clariant, BT and UNICEF. He is now working in Business Interruption for Advanta Global and as a Strategy Business Analyst for UNDP.
Oriol purchased the long lease in the ground floor, an apartment on the 2nd floor and the freehold interest in 2016. He has since sold the groound floor to a commercial retail operator.
He has appointed Corrado Accardi as the lead consultant/project manager to supervise this project. Corrado holds an Executive MBA from the London Business School and is a chartered engineer with 16 years experience in Construction Cost/Project Management(PM).
He has worked on the contractor and client side as contract and project manager on residential and retail projects in Italy and the UK (with values ranging from £200k to £2.5m).
Projects include PM of the £50m renovation of the 450-room Intercontinental Park Lane hotel in London, the development management for the construction of the £30m 145-room Adina Hackescher Market Apartment Hotel in Berlin, the pre-contract co-ordination of the £20m Nuclear Academy in Cumbria (UK) and £130m Borgo di Villa Saletta 5* hotel development (Italy).
He is also the founder of Pizza Roussa Ltd an award-winning Italian restaurant based in City of London.
6 month loan
18 month loan
This was a project we successfully funded earlier in 2018 to include other parts of the building. At the time we were unable to progress the loan as various legal and technical issues arose during our due diligence. These points have now been addressed and Oriol has returned for funding on the development of the rooftop to provide a new apartment. His Project Manager and Architect are experienced in City Centre rooftop developments and have worked through the technical issues so they are now ready to commence the works.
Our in-house property experts thoroughly assess each project proposal. We scrutinise the developer and any of their partners’ track records. Only the most promising projects, by the most experienced developers, will receive an informal offer. CrowdProperty will only work up to certain loan-to-value and loan-to-cost percentages, and each project must meet our 25% profit-on-cost criteria. For more information please view our risk statement.
A ‘1st legal charge’ gives CrowdProperty the legal right to take ownership of a property in the unlikely event that a property professional defaults on their loan repayments. 1st legal change is the highest level of security and gives CrowdProperty all the rights that a mortgage company holds. We have 1st legal charge on every project listed on our platform. This is an essential, non-negotiable criterion to ensure your funds are safe.
Our in-house experts perform strict and rigorous checks on all projects proposed. With almost 100 years’ experience in the industry, we work in partnership with our borrowers. We work in partnership with our borrowers until project completion. If a borrower were to default, CrowdProperty’s 1st legal charge allows us to take ownership of the project. Here we would utilise industry experience to ensure the most suitable exit strategy was followed.