Special servicing case study

Mapeley II Loan: Mapeley ‘Beta’

Loan to value turnaround in less than three years for Mapeley Beta

The property

  • Mapeley Beta portfolio comprising 16 office schemes around the UK at 1.18m ft² with 27 tenants.
  • Largest occupier, Microsoft, occupies 246,000 ft² at Thames Valley Business Park, Reading.

The loan

  • Mapeley II starting loan to value ratio of the original loan: 75 per cent.
  • Original loan: £280m.
  • Valuation: £278m.
  • August 2012 valuation: £134.3m breaching its 90 per cent LTV trigger and representing a LTV of 141 per cent.

The problem

  • No asset and property management strategy.
  • Spiralling rent and service charges and longstanding arrears.
  • Unsettled tenants.

The solution

  • Urgent issues affecting cash flow dealt with as a priority stabilising the situation.
  • Rigorous appraisal of each asset to create a viable asset and property management strategy.
  • Consultation with tenants to secure them.
  • Investment in capital expenditure work to modernise and improve properties towards letting voids.
  • Invigorated marketing campaign.

The effect

  • In early 2015, valuation: £191.4m and for a complete portfolio sale: £200m.
  • LTV: 94 per cent.