Investment Property Loan

Our investment property loan is for businesses that want to buy commercial property for investment. The loan is tailored by us and the client to suit the particular tenancy agreements.

Is it for you?

Purpose Term funding is normally provided to assist with the purchase of premises to provide accommodation for local community based organisations.
Borrower Typically umbrella organisations.
Amounts Normally £0.25m to £5.0m.
Loan to value Max. 70%.
Term 3yrs to 30yrs (normally subject to mutual 10 year "breaks").
Interest Margin Variable Typical margin over Bank Base** Rate: +2% (minimum 4% p.a.).
Fixed Available for up to 5 years (subject to availability).
Capital Repayment Holiday Normally 2 years maximum.
Fees Typically 1% of the amount of the advance. NOTE - all legal and valuation fees to be borne by the applicant.
Security Usually a first legal charge over the freehold or leasehold property. Where the property is leasehold, it must have more than 35 years unexpired upon repayment of the facility.
Financial Covenants We would expect retained surplus + interest + depreciation (+ tax) to cover loan interest and repayments by at least 100%. We would also expect rent roll to cover loan interest and repayments by at least 120%.
Requirments We would normally expect Unity Trust Bank to provide main bank relationship.

**Base = Bank of England Base Rate.

Applicants

  • Applicants must be able to demonstrate appropriate experience and expertise in property investment and their operations should be conservatively geared.
  • Applicants can be individuals, companies or SPVs.
  • The Bank's desire to lend will depend largely upon the strength of the covenant(s) of the lease(s). We are seeking good quality tenants with a strong reputation whose financials can be easily assessed.
  • We are looking for well located properties where there is continuing demand.
  • Our minimum interest cover for propositions meeting all our criteria is 110%.
  • The loans will be required to amortise to a minimum of 50% LTV against Vacant Possession Value by the end of the term of the lease (subject to negotiation in respect of multi-let properties where these is a good spread of lease terms and covenants).


Preferred sectors

Please be advised that we do not lend to offshore entities and we do not lend against residential property portfolios, or for residential development.


Interested?

For more information on our Investment Property Loan, simply: