It plans to allocate an additional £100 million for the loan scheme
Specialist lender Assetz Capital has introduced a new Planning Assistance Loan product designed to facilitate the conversion of commercial properties into residential units.
The product targets experienced property developers, providing them with financial support to acquire commercial buildings for conversion into residential, purpose-built student accommodation (PBSA), or private rented sector (PRS) dwellings.
Upon securing the appropriate planning permissions, borrowers have the option to transition their financial arrangement into a refurbishment loan, further aiding the redevelopment process.
In response to the fluctuating interest rates, Assetz Capital has set the launch rate for this product at a fixed 10.5%.
The lender plans to allocate an additional £100 million over the next two years to support property developers, supplementing its existing lending goals.
This move aligns with Assetz Capital’s strategy to play a more active role in repurposing underused commercial spaces in urban centres across the UK. Over recent years, the lender has financed numerous projects, contributing to the creation of over 955 new residential spaces and facilitating over £54 million in gross debt for office-to-PBSA conversions.
The product launch comes on the heels of Assetz Capital’s announcement of a £200 million increase in its lending partnership with Aros Kapital.
“At Assetz Capital, we are always looking for areas where we can continue to increase the support we provide to property developers across the UK,” said Andrew Fraser (pictured), chief commercial officer at Assetz Capital. “This new product will provide £100 million of funding to developers in acquiring commercial property with a residential conversion focus over the next two years.
“We will consider commercial properties with clear residential-led development potential. We want to support realistic projects and be part of the larger repurposing of city centres across the UK.
“Assetz Capital has been heavily involved in some fantastic repurposing schemes, such as turning old office or warehouse facilities into modern, vibrant, and much needed housing stock, with a core optic being in the student space, but not exclusively. There are vast amounts of opportunity to convert these underutilised commercial sites in our city centres, so we’re excited to be part of the solution to drive residential development over the coming years.”
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