21 Feb 2022

Investec supports LEXI Finance with £10.3 million loan for repositioning assets

  • Real estate capital advisory LEXI Finance has structured a £10.3 million deal with Investec for several industrial assets in Bermondsey. 
  • The facility supports the borrower’s plan to reposition these assets to create a premium-quality mixed-use scheme with a Gross Development Value (GDV) of £170 million.

Real estate capital advisory firm LEXI Finance has arranged a term loan for the refinance of industrial assets in Bermondsey, London, with a combined value of £15.8 million.

The four-year £10.3 million loan was provided by Investec, an international banking, investment and wealth management group with a specialist real estate proposition.

The Edition Group, an architectural design led development firm, are seeking planning permission to reposition these assets to create a mixed-use development, with a projected GDV of £170 million.

The existing assets have been deliberately part-tenanted with short leases to enable planning works to progress as the propriety. To reach the required loan-to-value LEXI and Investec structured a facility that included an interest reserve and capital guarantee to meet the required interest cover ratios.

The area is noted for several recent regeneration projects, such as London Square Bermondsey, which has redeveloped the district’s iconic abandoned industrial buildings to create 406 new, premium-quality homes and retail spaces.

Bermondsey is currently one of the most desirable regeneration destinations in London with rich culture, history and proximity to the City. This is reflected in the demand for homes in the district: Bermondsey house prices rose seven percent in 2021, well above the negligible house price increases for London as a whole. The Edition Group’s plans will reflect Bermondsey’s culture and heritage, containing space for local artists’ studios as well as mixed commercial space.

Charlie Armstrong, co-founder of LEXI Finance, comments:

“This is a really interesting project to be involved with given the proximity to Bermondsey and the redevelopment potential.”

“Investec took the time to understand the wider asset management play and were fully supportive of Edition Group’s efforts to secure consent for a landmark mixed-use scheme. We were able to work with them to structure a facility that met the sponsor’s key goals whilst providing the lender with the tailored financial covenants they needed to get comfortable.”

John Smart, director of The Edition Group, comments:

“We were very impressed with the dual efforts of LEXI and Investec to structure a loan that matched our ambition for the project.

“This is a landmark project for Edition Group and our team, we are looking forward to working with the council to bring forward plans that reflect the vibrant Bermondsey community.”

Matthew Robinson of Investec Real Estate, comments:

“We are really pleased to support the Edition Group on the refinancing of their Bermondsey project with a bespoke tailed loan that met their needs. We are impressed with the Edition Group’s vision for the area and see the clear redevelopment opportunities and benefits for Bermondsey.

“Working with LEXI and Edition Group, we were able to conclude the matter in a timely fashion enabling the sponsor to start working on their plans quickly.”