Arc & Co completes £480m property lending in 2019

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  • 14/01/2020
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Arc & Co completes £480m property lending in 2019
Specialist finance brokerage Arc & Co facilitated almost £480m of property finance in the last year.

 

According to results published by the firm, it completed more than £534m worth of lending in its 2019 business year, with £479m of this for property deals.

The firm said the number of loans completed rose 10 per cent due to increased headcount in the team and refinancing figures increasing, with a total of 201 property loans completed.

Development finance accounted for £199m worth of lending in the period – the biggest sector for the brokerage.

The firm noted its development loan book was down by six per cent due to economic and political uncertainty and the impact this has had on larger-scale developments.

“However, we have actually undertaken a higher volume of development deals and for more clients, but for smaller loan values,” it added.

 

Commercial and refurbishment growth

In contrast, commercial and refurbishment loans saw upticks of 15 per cent and eight per cent to £111m and £25m respectively.

For commercial loans, Arc & Co noted this was due to clients buying long-term income assets and the cheapness of long-term debt.

“Gilt and swap rates have been low, so it has been a good time for people to buy commercial assets,” it said.

It highlighted the increase in refurbishment loans was for two reasons: People looking to add value to their existing properties; and developers looking at interim refurbishment projects while waiting for more certainty in the market and land values to adjust.

The brokerage also completed £59m of bridging, £27m of buy-to-let and £57m residential mortgage lending.

 

Lender numbers up

Arc added that the number of lenders it had used was up by 12 per cent due to new liquidity in the market.

“We have been expanding our loan book by geographic spread and this has presented the need to build relationships with additional lenders,” it continued.

And while first charge funding still accounted for £504m lending, second charge completions rose 25 per cent as senior lenders become “more conservative because of market conditions”.

“Due to senior debt being more cost effective, the overall cost of blended first- and second-charge funds has become more appealing to the client,” it added.

Arc also completed £54m of aviation and marine finance deals.

In September, Matthew Yassin joined Arc & Co as a director in its structured finance arm after 14 years at Coreco.

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