OVERVIEW
A portfolio landlord approached Propp looking to refinance a fully let commercial investment property held within a Self-Invested Personal Pension SIPP.
With the property valued at £475,000 and an existing requirement to refinance, the client was seeking a competitive commercial mortgage solution that would work alongside the specialist ownership structure of the asset.
Despite additional legal reviews associated with the SIPP, the commercial remortgage was successfully completed, providing long-term funding certainty through a five-year fixed-rate facility.
THE CLIENT'S REQUIREMENT
The borrower, an experienced portfolio landlord, owned a fully occupied commercial investment property through a SIPP structure and required a commercial property remortgage to refinance the asset.
The transaction required a lender capable of understanding both the investment profile of the property and the specific legal requirements associated with pension-held assets.
The client's objectives were:
Refinance an existing commercial property loan
Retain the property within the SIPP
Secure a long-term fixed interest rate
Benefit from an interest-only repayment structure
Minimise disruption to the ongoing investment strategy
CHALLENGES
While the commercial investment property itself presented a relatively straightforward lending proposition, the SIPP ownership structure introduced additional complexity.
From a lending perspective, this was a low-leverage transaction.
The property was valued at £475,000, with the client seeking a loan of £102,000 on an interest-only basis.
During underwriting, the lender requested a review of the SIPP deed, resulting in extra legal work and a longer completion timeline than originally anticipated.
The client needed a lender comfortable with both commercial investment property and pension-held ownership structures, while still delivering a competitive long-term rate.
SOLUTION
Using Propp's lender network, we sourced a commercial mortgage lender able to accommodate the SIPP structure and progress the transaction through underwriting.
Facility Details
The agreed facility included:
While additional legal checks were required, the deal continued to move forward and ultimately completed successfully.
THE OUTCOME
The client successfully refinanced their commercial investment property and secured a five-year fixed-rate facility that aligned with their portfolio objectives.
What could have become a frustrating delay due to specialist legal requirements remained exactly what it should have been: a straightforward commercial remortgage completed with the right lender and the right guidance.
