Fiduciam announces London deal worth almost £1m

Fiduciam has announced a deal worth almost £1m on two properties in south-west London, as the bridging lender seeks to push into the London market.

The borrower, a building contractor looking to expand into property development, had initially approached Fiduciam for a 65% first-charge loan to fund the purchase and refurbishment of a property in Battersea, with a market value of £1.3m.

As the deal was nearing completion, the bridging lender learned that the applicant had a cash shortfall of around £100,000.

To ensure the deal progressed quickly, Fiduciam arranged a valuation on another property owned by the applicant in nearby Sutton, and valuing this property at £1.5m, the lender offered a 54% LTV second-charge loan, enabling the applicant to cover the shortfall.

Fiduciam revealed this was put in place in ten days and the deal was able to go ahead with the borrower securing a total loan of £950,000 over 12 months, at a rate of 0.80% per month.

Fiduciam chief executive, Johan Groothaert, said: “The London property market has gone through a major correction, and we believe that right now a lot of bad news has been priced in. London is an international business centre, which means many real estate buyers come from overseas, and therefore it is important to also consider the effective exchange rate of pound sterling, which is down nearly 20% since the end of 2015.

“The cumulative effect of London real estate market correction and the depreciation of pound sterling means that London real estate is now attractively priced in comparison with other international business centres.

“With the election bringing an end to a period of political instability, we believe that the upside potential now clearly exceeds the downside risk. For that reason, we wish to increase our loan book exposure to the London market.”

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