£2.6m Hotel Acquisition Funding, Greater London near Gatwick

An experienced owner-operator within the Hospitality sector, seeking funding support for the acquisition of a hotel asset near Gatwick.

To secure competitive acquisition funding with a structure that supported long-term cash flow, while minimising upfront costs and ensuring a smooth transaction timeline.

Hospitality sector risk: Hotels are typically perceived as higher risk and are not a lender-favourite asset class.

Difficulty getting High leverage at low cost: Achieving a strong loan-to-value on a commercial asset while maintaining a competitive interest rate is a challenge for commercial hospitality properties.

Costly rigidity: Many lender offers included high early repayment charges and fixed-rate structures, limiting flexibility and increasing long-term cost.

We structured and negotiated a tailored funding package, leveraging both the strength of the asset and the client’s proven operational track record. The property’s EPC B rating played a key role in securing enhanced lender terms.

Funding secured: £2.6 million (70% of Vacant Possession value)

Rate: 1.39% over BOE rate.

Arrangement fee: £0

• Typically charged at 1% – 3% for similar transactions
• Delivered an immediate saving of approximately £40,000 for the client

Repayment profile: Extended term negotiated to support long-term cash flow

Additional benefit realised:

Since completion, the Bank of England base rate has reduced, resulting in an immediate 25 basis point reduction in the client’s interest cost, delivering a direct and ongoing financial benefit due to the variable rate structure.

Strong asset fundamentals

Client’s experience as a hotel owner-operator

Strategic lender selection and deal structuring

Close and constant coordination with lender, borrower, and solicitors

A competitive and well-structured funding solution, demonstrating how the right approach can deliver meaningful financial benefits and a smooth acquisition process.