InterBay provides £24.9m to student accommodation group
InterBay, part of OSB Group, has provided £24.9m in commercial refinance and development loans for Yorkshire-based student accommodation provider the Kexgill Group.
£20m of the total is a 10-year facility fixed for five years, interest-only commercial investment refinance of 350 student bedrooms, all previously mortgaged with InterBay, located in Bradford, Hull, Liverpool, Middlesbrough, Nottingham and Preston. All of the properties are student accommodation that has been refurbished and finished to a high standard, including a number in the prestigious University Quarters neighbouring Hull and Nottingham Trent universities.
The bigger the deal, the greater the potential stress for the borrower. However, the Kexgill team were reassured by the process all larger cases go through with the assistance of OSB Group’s High Net Worth Team and approval by the Bank’s internal Transactional Credit Committee (TCC). The Group’s TCC is made up of senior members from across the business. They review every application worth more than £3m and quickly establish whether additional requirements are needed to support a case. If the TCC agrees a case, it provides confidence and comfort to the broker and their client that InterBay will support the application.
For further reassurance to the borrower, presentation to TCC takes place before a valuation is instructed, ensuring that clients only pay for valuations if InterBay can take a case, potentially saving substantial amounts of money, particularly in a deal of this size.
Indeed, revaluing a portfolio as large as this Kexgill student investment inevitably posed a challenge due to the sheer volume of units involved. However, the InterBay real estate team enjoys a close relationship with its panel of valuers, a panel which was extended in January. Working collectively with the panel, the client, the solicitors and broker Steve Williams, the team was able to complete the deal smoothly.
Richard Stott, managing director of Kexgill Group, commented: “Securing medium-term fixed rate debt in a variable market is important for our Group, particularly where we are creating scale in locations outside our Hull base. It has been a stress-free deal in a market which has seen considerable flux in recent months.
“Thank you to all involved in this smooth transaction, in particular InterBay, who continue to support our growth in the affordable student accommodation sector.”
Marc Callaghan, Head of Specialist Finance at InterBay, part of OSB Group said: “It’s been a pleasure working with Steve and the team at Kexgill and is a reflection of the strong working partnership that we’ve developed over the years.
“Truly understanding our clients’ and their customers’ requirements, including how they operate, the level of support they require and using the expertise available through OSB Group are important factors for being able to close a deal with a tailored solution for a positive customer outcome.”
This article first appeared in Bridging and Commercial.