Hermes finances Thor and Chenavari’s Soho scheme

Hermes Investment Management has provided a £29 million loan to Thor Equities and Chenavari Investment Management to fund the acquisition of an office and retail building in London’s Soho area, Real Estate Capital can reveal.

The loan finances the joint venture’s purchase of 147-155 Wardour Street. The partners bought the 25,365 square foot asset for £43 million, implying a 67 percent loan-to-value. The financing contains an acquisition tranche and a capex tranche to support refurbishment and leasing plans.

The new owners plan to refurbish the six-storey mixed-use property, including an upgrade of the building’s façade.

Retail tenants in the building are Hummingbird Bakery, L’ETO Caffe, and contemporary art gallery Unit London. Office tenants include First Point Group, the corporate office of Hakkasan, and games developer Mediatonic.

This deal brings the total amount Hermes has invested in the UK real estate senior debt market to £360 million across 14 loans.

The facility is the third financing deal Hermes has provided to the joint venture, following the funding of two central London properties – 145 Oxford Street and Dover Street – last year.

“Their recent record of accomplishment for projects of this nature and our experience of working with them on the 145 Oxford Street and Dover Street transactions, gives us great confidence in their ability to transform this asset,” said Vincent Nobel, Head of Real Estate Debt at Hermes Investment Management. “The loan structure fits nicely within our revised lending mandate, allowing us to invest anywhere within the real estate capital structure.”

Jared Hart, managing director at Thor Equities, said that the firm hoped to continue its relationship with Hermes “as we continue our focus on emerging locations in London, and other European cities”.

“151 Wardour Street is an exciting opportunity and is in line with Chenavari’s investment strategy which focusses on targeting value add propositions in core locations across the UK and Europe,” added Sam Mellor, partner at Chenavari Investment Management.