At a glance
GRE Capital provided a 24 month senior loan to fund the purchase of containers and the fit out of a 1.05 acre freehold site for open self storage. Planning permission permits Use Class B8 self storage with 141 single stacked containers, on site office, parking and secure gating. The site fronts the North Circular close to Park Royal, with rapid access to the A40 and the national motorway network.
The brief
E Storage Investments Limited, an SPV created by EasyStorage within the easyGroup, sought capital to establish and operate the site directly due to its prime location and connectivity. Ramp up meant year one cash flow would be constrained, so the structure needed to accommodate partial interest roll up before stabilisation and investment refinance.
The GRE solution
GRE Capital delivered a first charge senior facility with a further advance to complete the fit out, supported by a debenture and share charge. The facility allowed part roll up of interest in year one while the site leased up, with servicing thereafter from operating income. Conditions included evidence of sustainable net operating income on stabilisation and standard property and corporate due diligence.
The outcome
The loan enabled the borrower to launch a branded self storage site in a supply constrained area and to move toward an investment refinance once operational performance is established. The location and planning status provide strong fundamentals for long term income.
