FRP Real Estate Advisory secures £4.3m development loan for Grade II listed barn conversion

FRP Real Estate Advisory has arranged a £4.3m development finance facility for the conversion of five luxury barn units across a Grade II listed site, achieving 72% LTGDV through a blended senior debt and mezzanine structure.

Background

A residential developer sought funding to convert five luxury barn units across a Grade II listed site. The project carried a nuanced planning position — three of the five units held full planning permission at completion, with the remaining two subject to a condition to secure approval within six months. The transaction was led by Dieter Kerschbaumer, Finance Advisor at FRP Real Estate Advisory, whose prior background as a RICS Quantity Surveyor and longstanding relationship with the client proved central to the deal’s success.

Action

Structuring a facility that covered 100% of build costs across all five units, despite the partial planning position, required close collaboration between lenders, the wider professional team, and careful navigation of credit requirements. To maximise leverage from day one, FRP worked with the client to resubmit planning on a pending unit, splitting it into two additional units. The resulting funding package comprised:

• £3.9m senior debt alongside £400k mezzanine finance, structured as a blended facility over a 21-month term
• 72% LTGDV achieved through the blended senior and mezzanine structure, in a market where lenders are applying increased scrutiny to leverage and planning risk
• 100% build costs funded across all five units, notwithstanding the partial planning position at completion
• Proactive planning strategy — resubmission and unit split executed to strengthen the overall position and maximise day one leverage

Outcome

The £4.3m facility was successfully arranged, providing the developer with the full funding required to deliver five luxury barn conversions across the Grade II listed site. The 72% LTGDV outcome represented a strong result in the current lending environment, underpinned by careful structuring and collaborative working across the entire professional team.