- Clients comprised of a team of experienced builders and BTL landlords who saw an opportunity for HMO accommodation
- Sourced 3 vacant ex-public houses for change of use
- The 3 pubs will be converted to provide in total 54 rooms
- The 3 properties were in an area where there is a significant shortage of accommodation
- Roma Finance provided £240k over 12 months for the purchase and renovation works
Roma Finance, the bridging and development finance lender, helped two Midlands based property entrepreneurs purchase a string of pubs in the Lake District to convert to Houses in Multiple Occupation (HMOs).
The clients saw a gap in the market when they learnt that there is to be increased investment in the area and were looking to acquire the pubs in order to satisfy the increasing demand for rooms from contract workers.
The business partners completed their research and found three former public houses that they planned to convert. One is to be a twenty six bed HMO and the other two will both be fourteen bed HMOs.
HMOs are well known to offer the potential of higher rental yields and the clients did their sums to make sure they were viable.
Although the pubs were structurally sound they were not in good condition and due to the nature of the project they needed a specialist lender that could deliver the finance they needed within a short time frame for the refurbishment and change of use building works.
The client’s introducer put them in touch with Roma Finance who specialises in financing the renovation and conversion of property to other uses by landlords, businesses and property developers.
Roma Finance met the entrepreneurs to understand their project and plans for the properties. After hearing of their experience and well thought out plans for the pubs, three separate loans were agreed – one for each property – totalling £240,000 over twelve months. The exit will be a commercial re-financing of each of the properties once they are converted and up and running as HMOs.
Scott Marshall, Operations Director at Roma Finance, said: “This was an exciting case as it’s always a pleasure to work with clients who not only have vast experience in converting property but also did their sums to make sure the yield calculations were favourable too. It was also a pleasure to see unused buildings, in this case pubs, being brought back to life with a positive change of use that will help the growing workforce and the local community.”