2024 REVIEW
Welcome
Mark Harris Chief Executive
2024 has proved to be another successful year for SPF Private Clients despite significant political and economic headwinds.
Both revenue and EBITDA grew in 2024, increasing by 14% and 27% respectively. Once again, having a diversified offering enabled SPF as a company to do well overall with strong growth from our general insurance and wealth and protection divisions in particular.
The debt markets were challenging but the residential team continued to dominate the HNW mortgage market offering invaluable advice to those with larger mortgages and more complex funding arrangements. During the year we expanded our offering further in the Far East, acquired the leading Irish mortgage and protection broker – Finance Solutions – and opened a new office in Dubai.
We expect to see improving conditions in 2025 with several base rate cuts forecast and hopefully some additional Government stimulus for the market.
Finally, the commercial debt team traded particularly well, and I hope you enjoy their detailed review of the year in this publication. w
Mark Harris
Team Highlights
TOTAL LOAN AMOUNT:
£575m
LARGEST LOAN SIZE:
£152.5m
NUMBER OF LENDERS USED:
48
TOTAL PROPERTY VALUE:
£900m
AVERAGE LOAN SIZE:
£4.5m
NUMBER OF TRANSACTIONS:
135
2024 Review
Daniel O’Neil Executive Director
As we settle into 2025, SPF’s commercial debt team can look back at 2024 with a strong sense of satisfaction even though it was a challenging year for the UK commercial real estate sector. I am pleased to announce that our team successfully advised across 135 transactions, with a total property value of circa £900m and a total drawn loan amount of circa £575m. This was a fantastic achievement in a difficult market where transaction volumes were limited, and due diligence takes longer than ever.
The start of 2024 saw a particularly hesitant market despite strong lender liquidity and falling inflation. It was evident that the market had reached the bottom of the cycle, and sentiment started to improve. As the year progressed, the commercial mortgage market and borrowers in general began to emit more confidence, spurred by greater political stability and base rate reductions. Our team transacted deals across the full range of leverage levels and across all products and lender profiles, with a particular focus in the living and operational sectors, including purpose-built student accommodation (PBSA), build to rent (BTR) and hotels.
I would like to highlight our largest transaction in 2024 which was a prime central London hotel bridging and extensive refurbishment loan for £152.5m – a truly expertly-brokered transaction from my colleague David Yeadon. With demographic shifts, changing housing preferences, and strong investor demand at their core, we expect these sectors to deliver resilience and continued opportunities in 2025, despite broader market challenges.
I would like to take this opportunity to thank the 48 lenders we transacted with in 2024. While we tend to work with a core set, our team’s combined experience of more than 200 years means we have a
strong array of lenders at our disposal across the entire capital stack (debt, mezzanine and equity) with typically senior management and founder-level relationships. The UK lending market is robust and extremely liquid, with most lenders needing to deploy their capital swiftly, and with reduced interest rates in 2025, they should offer more competitive terms. I would also like to thank our long-standing friends at Savills and owners at Howden who continue to provide our team with support and collaboration.
2025 has started off with news of higher UK borrowing costs and ongoing unrest around the impact of the Autumn budget on businesses and additional concern regarding what March’s Spring forecast will bring. However, we are optimistic that transaction levels across the debt markets will continue to improve. We witnessed that the commercial investment market hit a trough in 2024, but we hope that along with lower interest rates and cost of debt, this will stimulate a pick-up – we certainly need it! With regards the living or “Beds” sector, there are several Labour Government initiatives which could start to feed through this year. Not least the Invest 2035 strategy, with a goal to promote sustainable development, regional growth, and investment in infrastructure. We must also see significant planning reform at the local level to expedite the delivery of much-needed housing.
The SPF commercial team remains indebted to its remarkable clientele across the UK. We believe that 2025 will be a productive year and we are well placed to assist our clients in executing their funding strategies for the year ahead. w
Daniel O’Neil
The SPF commercial team remains indebted to its remarkable clientele across the UK.
Recent Transactions
£152.5m commercial real estate loan
Corus Hyde Park Hotel
w Location – London
w Lender – ESR Europe
w Client – MUI Group
w Purpose - to refinance existing debt and fund an extensive refurbishment of this 200-year-old listed Georgian mansion hotel, situated directly opposite Hyde Park.
£26.8m
development loan
Bicester Motion, a 444-acre future mobility estate
w Location – Bicester, Oxfordshire
w Lender – Cain International
w Client – Bicester Motion
w Purpose – to fund the delivery of the estate’s latest property development, consisting of headquarters buildings for innovative transport technology companies.
£31.3m development loan
Two Build to Rent (BTR) schemes
w Location – Bolton and Halifax
w Lender – CBRE / Greater Manchester Pension Fund
w Client – Placefirst
w Purpose – to provide a funding solution to support Placefirst, a prominent North-West BTR platform, with the delivery of two BTR schemes in Bolton (167 residential units) and Halifax (122 residential units). Both schemes are underway with delivery scheduled during 2025. When delivered both schemes will provide a quality of BTR product not currently available in either location.
£9m trading hotel refinance and development acquisition
3 leasehold hotels refinanced and rebanked
w Location – Central London
w Lender – Allica Bank, InterBay
w Client – Small hotel group
w Purpose – to refinance and re-bank from a restrictive mainstream bank, inclusive of a capital raise to finance a new hotel development opportunity.
£7m semi-commercial portfolio refinance
A mixed-use retail and residential property portfolio
w Location – South London
w Lender – Challenger Bank
w Client – Stellenbosch Ltd
w Purpose - to fund the expansion of the portfolio.
£140m refinance of existing borrowings
5,000+ plot of residential land
w Location – South-East England
w Lender – a leading European alternative investment manager
w Client – a South-East England housebuilder.
w Purpose – to assist a long-standing client in the refinancing of a 5,000+ plot of residential land In the South-East of England. The client had borrowings across various parcels of the land with five different lenders and we successfully refinanced all existing borrowings with one lender who also provided a revolving credit facility (“RCF”) to enable the continued development of residential homes for sale on part of the site.
£2m commercial investment loan
Factory and warehousing facility
w Location – West Yorkshire
w Lender – Lloyds
w Client – SB&O – complex trust structure
w Purpose – to capital raise for further investment opportunities.
£14m
residential
development loan
Two luxury apartment developments
w Location – Manchester City Centre and Cheshire
w Lender – a regional specialist debt provider
w Client – Prestbury Estates
w Purpose – to fund the development of 25 high-end city apartments in Manchester and 6 large luxury apartments in Cheshire.
£13.5m
residential
development exit refinance
Apartment development
w Location – South London
w Lender – Hilco Real Estate Finance
w Client – Sojobo Limited
w Purpose – to fund the refinance of 24 apartments at 75% LTV. The funding requirement was to arrange a flexible facility that allowed for a mixture of BTL and sales exits.
£10m acquisition & development facility
Residential Development
w Location – Cotswold
w Lender – Quantum Development Finance
w Client – Acorn Property Group
w Purpose – to fund the development on site one of 17 new-build, private residential homes and on site two; the conversion of an existing building to create a further 7 private residential homes. The transaction was completed under significant time constraints and required a bespoke funding structure to overcome various complex planning obligations.
£31m portfolio acquisition & refurbishment facility
Student accommodation
w Location – Bristol & Bath
w Lender – Atelier
w Client – Rengen Developments
w Purpose – to fund the purchase and refurbishment of 6 separate PBSA properties to create 190 new student beds. The average LTV across the 6 sites was 88%.
Our Commercial Team
Daniel O’Neil Executive Director
Director
Executive Director
Daniel joined SPF in 2007 from another Mayfair based advisory where he had been since graduating from UCL and Cass Business School.
With nearly 25 years’ experience, Daniel is considered an expert in the CRE finance industry and has significant expertise in structuring funding solutions principally for the development finance sector.
Daniel has cultivated client relationships over his career that span the UK. These include some industry leading developers and investors who are matched with his senior banking relationships across the debt stack, in addition to equity JV partners.
David started his career at RCC Financial services (Christie Group PLC) in 1987, where he remained until joining SPF in 2001 as Head of Real Estate – Debt Advisory.
During his career, David has arranged commercial debt solutions across the spectrum to include PBSA, hotels, healthcare and all commercial investment sectors to include industrial, retail, offices, logistics, residential investment and development.
David has an extensive private client network and long-established relationships with retail lenders, private banks, debt funds and insurance companies. David specialises in high value transactions and complex arrangements.
Russell started his career in banking with Capital Bank and HBOS before joining SPF in 2004 initially as a high-net-worth mortgage adviser. In 2011 Russell became the youngest director within SPF and continued to expand his knowledge in the real estate debt advisory area of the business.
With an extensive knowledge of development, investment and residential lending he is confident in advising across various sectors. His relationships with lending institutions and banks across the UK are unparalleled, giving SPF and its clients access to highly competitive funding solutions. With a focus on the regions and Scotland, Russell brings a national yet local approach to the team.
David Yeadon Executive
Russell Hall
Derek Simpson Director
James Hedges Associate
John Rubbert Director
Derek started his real estate lending career with Bank of Scotland in London. Prior to joining SPF in 2020, he headed up the Structured Real Estate team at Santander, focusing on commercial real estate transactions ranging in size from £20m to £250m. Derek is a highly-experienced banker with 20 years’ experience in the real estate sector and has arranged finance in excess of £3bn over the past decade across most sectors.
These sectors include commercial investment and development, residential development, retail, hotel investment and development, data centres and light industrial/logistics.
James joined SPF in 2019 having worked in debt advisory since 2012. He began his career as a specialist in financing the hotel and hospitality sectors at Eakin Macdonald & Associates Ltd. Since then, James has diversified into other commercial sectors, focusing particularly on residential development finance.
Since joining SPF, James has arranged a number of finance facilities with traditional bank lenders, debt funds and joint-venture equity partners for both development and investment transactions.
John joined SPF in February 2024 having spent the majority of his career as a real estate lender. Prior to joining he led the Commercial Real Estate Origination and Portfolio Management team at Wells Fargo, responsible for annual loan origination of circa £2.5 billion and a portfolio of approximately £10 billion across core real estate sectors.
John has 25 years real estate financing experience, specialising in structuring investment and development facilities in the UK and Ireland. Financing partners include traditional banking lenders, insurers and private credit investors, servicing international private equity investors, private and institutional UK investors, municipal pension/sovereign wealth funds and the listed sector.
Ian Leader Director
Ian joined SPF as a founding member of the Commercial team in 2001. He has been in the industry for the past 38 years covering sectors which include residential and commercial investment, residential and commercial development, owner occupied businesses and trading businesses.
Ian’s depth of knowledge and wealth of experience have proved invaluable over the years, with numerous clients returning to him time and time again for assistance with their funding requirements.
Natalie Glover Associate
Tom Naidu Associate
Natalie joined SPF in 2022 to further her career after 10 years’ experience heading up a small team at a previous brokerage. She has a keen interest in development finance and commercial term, with an in depth knowledge of bridging finance.
Natalie started her career in construction project management, working alongside developers on site. This unique experience has allowed her to build strong relationships with clients and she is well respected amongst peers in the industry.
Tom joined SPF in 2024 to expand the offering clients could benefit from with SPF. Having worked in commercial finance for over a decade, and in a boutique SME focused brokerage for eight of those, Tom brings an array of solutions to any trading or property business.
His consultative based approach allows his clients to benefit from his knowledge to find the product that suits their needs best. This has allowed him to build a client base across the UK that regularly call upon his expertise in sourcing finance facilities. These facilities have included bridging, development, asset, unsecured and invoice finance, along with buy-to-let and commercial mortgages.
Tom is well regarded in the industry and has been able to offer solutions where others cannot.
Insurance Market Update
Sean Charlton ACII, Director Head of Real Estate Insurance
In recent years, the insurance market hiked premium pricing and pulled back coverage for certain high risks driven by high inflation and increasingly erratic climate-related losses. These premium increases have helped drive the best year-onyear underwriting results for Property and Casualty carriers since 2007 based upon first quarter 2024 figures (source Deloitte 2025 global outlook).
The pricing outlook for 2025 is positive, largely due to a slowing down of inflation and higher investment yields. Barring a major catastrophic event, SPF anticipates increased insurer competition and with the availability of better reinsurance terms, conditions for insurers are more likely to lead to more favourable terms for insurance buyers.
We expect market capacity to remain roughly stable. Underwriters will continue to be disciplined about the accounts they underwrite but, given the positive tail winds referenced, we expect insurers to have greater flexibility for risks within their appetite. w
Sean Charlton
A Lender’s View
Richard Hemmings Managing Director
I am sure it is fair to say that most of us in the business community are not too sad to see the back of 2024. Property developers particularly faced a tough twelve months, with slow sales rates and labour market difficulties exacerbating the last few years’ build cost inflation and the perennial issues surrounding the planning process. The General Election and the October budget were both foreseeable show-stoppers for house purchasers, but even the softening of interest rates resulted in a drag on sales with buyers waiting to see how far rates would drop prior to committing. As a result of all this, “survive ‘til ‘25” was an oft-heard mantra as many developers tried hard to nurse damaged balance sheets through to the end of the year in the hope that sales rates would increase in the Spring to recapitalise their businesses.
It is to be hoped that the known-knowns and even the known-unknowns are now evident or behind us, so if pent-up demand carries forward into a more stable economic and political setting there should be some room for cautious optimism during 2025. There is evidence that the Government’s planning reforms are starting to be enacted (albeit slowly) with a new NPPF and increased local powers and funding intended to enable the achievement of very ambitious housing targets. Moreover, a more benign and steady interest rate environment should engender confidence among purchasers and investors. Nonetheless, there remain significant headwinds, with inflation, the availability of labour and bureaucratic elements such as the Building Safety Act all affecting viabilities, while the wider effects of the tax changes in the budget have yet to play out fully for businesses and household finances, all of which will have a significant influence on investment and purchasing decisions. Fundamentally though the imbalance
between supply and demand will continue to be a key driver, and with the Government apparently now receptive to addressing some of the sector’s issues we hope to see an improving sentiment and a steady flow of new starts on site throughout the coming year.
Here at Quantum Development Finance we have a team with broad experience of supporting developers throughout the cycle and we remain committed to supporting the sector even when times are tough. We have a suite of lending products to meet developers’ needs across the spectrum and our small, expert team is able to move nimbly to provide the best possible outcomes for our borrowers. Across the team we have a very strong and valued relationship with SPF and we have written more than £100m they have introduced. We are looking forwards to the coming year and, with SPF’s support, we are standing by to assist SME developers around the country to overcome the challenges they face in delivering the housing the country desperately needs. w
Richard Hemmings
Survive ‘til ‘25” was an oft-heard mantra as many developers tried hard to nurse damaged balance sheets.
