GRE Capital agreed a 12-month senior facility of £5.65m secured over 35.97 acres of consented brownfield land on the former Riddochhill Colliery site at Bathgate, forming the southern portion of the Lothian Gateway logistics development outside Edinburgh.
The borrower is an experienced UK logistics developer with a track record of more than 15 million sq ft of industrial and logistics space delivered. The site had been remediated and consented but construction had not yet started, and the requirement was for senior funding secured on the land to carry the scheme through to the point where a development facility could be put in place.
GRE Capital provided a fully retained interest facility over 12 months, with an option to extend by a further six months, so the loan carried itself throughout a period when the site produced no income. The land benefits from Permission in Principle for a logistics park with ancillary office space and sits immediately north of the M8 with direct access to two junctions, around 20 miles from Edinburgh and 25 miles from Glasgow. Leverage was set at under 50% of value, leaving substantial headroom.
With the facility in place the developer has been able to keep the scheme moving through the planning amendment process and fund project costs ahead of a construction start, rather than pausing the programme while the land sat idle. An application to allow the development to come forward in independent phases is progressing, and the site is positioned for a development facility once construction commences. Consented land at this level of leverage, in a market with a well-documented shortage of logistics space, was a risk we were comfortable taking a view on.