Buying property through a structure is challenging at the best of times. If your client needs a debt solution on a property owned by an offshore company or that has a complex ownership structure, the process can quickly move from challenging to exasperating.
Tenn is one of the few bridging providers that readily lends to offshore companies and complex ownership structures. We can lend against UK or international property, and we don’t require that the company we are lending to has a UK-based or UK citizen as a UBO.
Bridging Finance for Complex and Offshore Ownership
There are many (excellent) lenders who are ideally suited to offer bridging loans for straightforward transactions. Let’s say your client is a UK citizen and they want to use a bridging loan to buy UK real estate. The deal needs to be done quickly, but you have a few weeks to organise finance. You’ll generally find that lenders are aplenty and offers will be easy to come by.
But most bridging lenders want to lend to people, not structures. When bridging finance providers can lend to a structure that owns a property, it tends to be for very straightforward UK-based entities.
When your client doesn’t have a very standard situation, accessing finance can get very tricky, very fast. Lenders get skittish about their ability to recover unpaid loans from a structure rather than an individual. Most won’t have underwriting or valuation processes that can cater to international ownership structures.
Utilising Client Structures to Buy Property
For their part, your clients will typically hold a variety of offshore structures for their business ventures as well as for tax and estate planning. As they buy and sell property, you will want your clients to utilise these structures. Sometimes this will be because it is convenient. Other times it is to mitigate risk, ensure privacy or optimise taxes.
You can add in yet another layer of complexity if your client isn’t a resident or citizen of the jurisdiction they want to buy property in, or if the property they wish to secure a debt solution on is offshore. The more international the transaction (i.e., an offshore company with a UBO from the UAE buys a property in London), the harder it will be to find a lender that will grant your client a bridging loan.
Even relatively simple bridging finance that requires lending to something like a French SCI or Sàrl, which owns a property, will be out of the reach for the majority of bridging finance providers. Go one step further, and trusts, foreign SPVs and similar structures will be considered highly unusual. The more unfamiliar your lender is with the type of structure your client has, the harder getting a bridging finance through the structure will be.
How Tenn Lends
Here at Tenn Capital, we can lend to nearly any ownership structure or offshore company.
We aren’t limited by:
- Your clients’ ownership structure
- The jurisdiction where the structure is domiciled
- Nationality or residence of the structure’s UBO
- Where the security your client puts forward is located
- Working alongside parties and advisors that need to be involved in the deal
Our team understands complex structures, how and why they are used. Based in Guernsey and with decades of experience working with international clients, investments, and debt, we can lend to any structure in most locations.
Of course, there are a few caveats. We can make lending decisions exceptionally fast, but we need to see the complete picture to do so. Understanding your client’s structure, the value of the security and how the structure – and by extension, your client – will exit the loan will be paramount.
If this case applies to your client, we welcome you to contact us.