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Raising the Bar: A Creative Route to Commercial Ownership

Loan Amount

£150,000

Loan Term

10 years

LTV

50%

PROJECT BACKGROUND:

Our client agreed to purchase both the business and freehold premises of a well-established pub in Scotland for a total of £300,000.

He personally contributed £150,000 upfront to acquire the business, with an agreement in place that allowed three years to complete the purchase of the property. We were then engaged to secure finance for the remaining £150,000 required to complete the transaction.

To optimise tax efficiency and long-term investment potential, the client decided to purchase the property through an SPV rather than in a personal name.

CHALLENGE:

Although the pub had strong potential, it presented several challenges: limited trading history, an unconventional staged purchase structure, and a property that didn’t exactly sell itself on appearance alone.

The client needed a commercial lender willing to take a pragmatic approach – one that would lend based on asset strength and the early signs of solid trading performance, despite the short operational track record.

SOLUTION:

Working with Barclays, we secured a commercial mortgage at 50% loan-to-value on a 10-year capital repayment term, with a lifetime variable rate set at 2.11% above base.

This structure means our client won’t need to refinance in the future, providing long-term stability and removing the uncertainty of future rate reviews or refinancing costs.

Barclays’ flexibility and comfort with both the asset and the business’s developing performance made them the ideal fit. This allowed the client to transition smoothly from the business purchase into full property ownership without the need for private or bridging finance.

OUTCOME:

The client successfully completed the property purchase, consolidating both the business and premises under the new SPV.

Key results included:

Funding secured with a high street lender despite limited trading history
Tax-efficient SPV structure implemented
Competitive lifetime variable rate achieved
Full ownership and long-term growth potential realise

This case highlights how a creative deal structure, combined with strong lender relationships, can turn a “quirky” acquisition into a smart commercial success story.