Silbury Finance Maintains Deployment Momentum With Record-Breaking, Sustainability-Linked £74 Million Loan for Residential Development in York
Silbury Finance, an Oaktree Capital Management-backed development lender, has provided North Star Investment Management, Yorkshire's top creative property asset management company, with a £73.8 million senior lending facility to fund the development of a residential-for-sale scheme in York.
Silbury has originated the largest loan to date, a 30-month, 73% LTGDV facility. It will pay for the cleanup phase and eventual construction of a 215-unit apartment building on the Gas Works at Heworth Green site, which is in a prime city centre location.
The facility provides a discount on the exit fee provided North Star satisfies specific sustainability criteria, including a minimum high B EPC rating, in keeping with Silbury's commitment to supporting real estate initiatives that satisfy the highest environmental standards.
Known as The Gas Works, the scheme, which is expected to complete in 2024, will be built to the highest sustainability standards with best-in-class amenities and tenant wellbeing at its centre. Comprising a mix of one, two and three bed apartments across three towers, features will include an onsite gymnasium offering studio classes, flexible workspace, and an abundance of outside space, including an edible garden where residents can grow their own fruit and vegetables.
The facility is part of the larger Heworth Green Gas Works complex and is conveniently placed just a short walk from York city centre, with York Railway Station a 20-minute walk away.
Following this transaction and the £100 million in financing announced last week, Silbury has now provided approximately £430 million in development finance across the UK residential-for-sale and retirement living sectors in 18 months, £190 million of which is sustainability linked.
Gavin Eustace, Founding Partner at Silbury Finance, commented:
“Despite the wider market volatility and threat of a recession, the fundamentals underpinning the UK housing market remain highly compelling. In particular, we anticipate continued demand for regional schemes around high-growth urban centres, which are priced sensibly and that benefit from excellent infrastructure connectivity. We see a real opportunity to continue growing market share: the mid-ticket lending market remains woefully underserved, and having launched during the height of the pandemic, have a proven track record of navigating short-term headwinds.”
“We have now arrived at a point where high environmental standards for residential development are a given, from the design and construction phases onwards. Sustainable real estate is embedded in our DNA at Silbury, reflected by the increasing percentage of our loan book that has a sustainability-linked element, and we will continue to play our part in mitigating the effects of climate change.”
Paul Ellis, Director of North Star, commented:
“This is a complex site that had been vacant for over 20 years, which has required us to work with highly experienced partners, including Silbury Finance. The team’s deep knowledge of the UK regional residential market and ability to structure bespoke facilities means the delivery of what will be a highly sustainable and much-needed residential scheme is a step closer.”
Source: Silbury Finance
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