Quadrant finances U+I resi development

US debt fund manager Quadrant Real Estate Advisors has provided a £30.75 million stretch senior development loan.

Quadrant Real Estate Advisors has provided a £30.75 million stretch senior development loan to U+I, the UK property company formerly known as Development Securities, to finance an office-to-residential conversion scheme.

The US debt fund manager’s loan will fund the redevelopment of 55,000 square foot Valentine’s House, an office building in the Ilford area of East London. The scheme’s expected gross development value is £45 million.

The interest-only loan has a three-year term. Quadrant is known for writing stretch senior loans in the region of 75 percent loan-to-cost.

Valentine's House
Valentine’s House

The 1970s-built Valentine’s House was acquired by U+I for £5.3 million in 2011. The office block is to be redeveloped into 122 apartments and 20,000 square feet of ground floor shops, designed by architect Sir Terry Farrell. The homes have been pre-sold to IP Global.

The building is located adjacent to Ilford Station, which is set to be served by the new Crossrail line from 2018. An element of the site will be used by Crossrail for a new ticket hall. Planning consent for the Valentine’s House scheme was granted in October 2015 and completion is expected in Q4 2017.

Atlanta-based Quadrant is increasingly active in the UK and Irish markets, making around €100 million of loans in the last year.

Earlier this month, it teamed up with Irish state-backed Ireland Strategic Investment Fund (ISIF) to write development loans in Ireland. ISIF will invest up to €50 million, matching the investment by Quadrant, to finance office development and construction projects.

In September, Quadrant took a £35 million mezzanine participation in a £147 million whole loan underwritten by Lloyds to finance BMO’s purchase of the Parkgate retail park in Rotherham. The firm has also financed projects in Liverpool and Manchester and backed a D2 Private/Cheyne Capital Management joint venture when it bought Dublin’s Cleary’s department store.

Quadrant, which also has offices in London and Sydney, has nearly $6bn under management