Issue 2. April 2020

HS Finance Newsletter
Commercial Finance

HIGHLIGHTS

Alex 'takes away' more than he bargained for from his local takeaway.

How Hilton Smythe Finance can make a difference.

Commercial investment mortgage for industrial unit.

Unprecedented challenges to public health and SME businesses.

The Pensions Regulator has said employers should be allowed to suspend or reduce their pension deficit.

Alex ‘takes away’ more than he bargained for from his local takeaway

Alex Heylings, commercial finance broker for Hilton Smythe Finance was able to secure a loan, which was secured against the commercial property, to purchase a takeaway restaurant for his local Indian takeaway. The client is moving his existing restaurant, which has an award winning chef and great reviews on-line to a restaurant closer to home in Macclesfield to help with his work/life balance. The client has many plans for the Macclesfield business and we wish them all the best for future.


Delivering where others fail

Our client had previously been working with another broker who had been unable to source any finance for the purchase of a Water Services/Filtration business. We able to secure a £160,000 business loan (100% funding) to buy the business at sub 7%. We are over the moon to be able to present this approval to the client.


Buy to let mortgage North of the border

We were introduced by a local Independent Financial Adviser whose former client needed some advice on property finance. After talking to the client we knew it would be tough to find a lender due to the challenges of the location and a trading company as the borrower, but through our extensive network of financial contacts we were able to source a lender who would offer finance for a limited company and a property located in Scotland.

Commercial Mortgages

Commercial Mortgages & Business Loans

Fixed an variable rates with short and long-term periods, up to 25 years. Available to trading businesses looking for a commercial loan.


BUSINESS FOCUS

How Hilton Smythe Finance can make a difference

Commercial finance cafe

Our client saw an advert for Café G, an artisan kitchen and coffee house in Dulwich, South London, with seating for 50 customers inside and for 30 outside and a franchise business Gymboree, which offers sensory baby play combining music and movement. The businesses were being sold through Hilton Smythe Business Sales, part of the Hilton Smythe Group.

Once we understood the full financial picture, we were able to submit a lending proposal to acquire both advertised businesses. With a shortfall of a cash deposit, additional security was offered to a high street lender, which following a valuation meant the client could borrow enough to make the purchase.

Alex Heylings, commercial finance broker for Hilton Smythe Finance, said: “We quickly took on board the full financial picture and with this in-depth understanding of the buyer’s circumstances, we were able to submit a lending proposal to a high street lender that meant the client was able to borrow enough to acquire both businesses.”  

Gareth Smyth, CEO of Hilton Smythe Group, said: “The deal was not a straight forward one and its complexities demonstrates the synergy that exists between buying a business through Hilton Smythe Business Sales and how help also is readily available with the money side of a transaction via Hilton Smythe Finance.

“This showcases how the experts in our sales and finance divisions can make a real difference by working in tandem to get the best outcomes for both sellers and purchasers, as well as making the transaction run as smoothly and efficiently as possible.”

Alex Heylings said: “At Hilton Smythe they pride themselves on being able to find perfect new owners to enable established and well-loved businesses to continue to thrive when the current owners decide to take a new direction in life.

“With the range of expertise we have at Hilton Smythe Finance, we also are able to come up with tailor-made solutions to help a purchaser finance their takeover of a business, which sometimes means – as in this case – that we have to think outside the box to meet a lender’s criteria for the buyer to secure a loan.

Both the sellers, Debbie and Charlotte, and our client were very happy with the outstanding level of service that both Hilton Smythe Finance and Hilton Smythe Business Sales had provided. In fact, the sellers were so pleased that they sent a thank you card, flowers and a luxury hamper to the staff at Hilton Smythe Business Sales that had worked so hard on their behalf.

Some of the accolades the team received from the sellers and buyer of Café G and Gymboree:

Buyer of Café G and Gymboree:
“Seriously, you are awesome Alex. Thank you!”

Sellers of Café G and Gymboree:
“They found one buyer for the sale of two businesses! The team were quick to resolve issues and guided us through the process calmly and simplistically, the whole process was quite seamless. Thank you to the team!”

COMPLETED DEALS

Commercial investment mortgage for industrial unit

Referred to by a mortgage broker we knew based in Cheshire we were able to source a specialist lender who could offer the finance based on the overall health of his business and revenue streams. The client had put loads of investment into the trading premises over the years and the landlord acknowledged this and agreed to sell for the original price £140,000, with the estimated value over and above £200,000.


Unsecured loan to buy a hair/beauty retail store

This business had been advertised through Hilton Smythe Business Sales and working with the client over several months we were able to put together a lending proposal to help raise an unsecured loan to form the bulk of the purchase price.


High street bank finance at a very competitive rate

£240,000 commercial mortgage for an experienced vehicle technician to purchase a freehold garage business dealing in repairs and MOT’s, and a disused petrol forecourt. This loan equated to 80% of the freehold value and still we obtained a margin of sub 3.75%.


Unsecured Overdraft

We were introduced to the client after their existing bank was not able to fully support their needs. They had owned and operated a long established electrical contracting business and we managed to obtain approval with another high-street bank just before Christmas and completed on both the overdraft and full account switch within a matter of weeks.


Commercial Mortgages & Business Loans

Fixed an variable rates with short and long-term periods, up to 25 years. Available to trading businesses looking for a commercial loan.

COMPLETED DEALS

FINANCIAL NEWS

Unprecedented challenges to public health and SME businesses

Hilton Smythe Finance has access to accredited lenders who offer the Coronavirus Business Interruption Loan Scheme (CBILS). If you need details of this support, please contact us immediately.

Not every business will be eligible or have sufficient time to wait for the scheme to process their loan request. As an independent broker we are here for you to offer free no obligation advice on your finance options. There are many alternative products you may want to consider.

Coronavirus Business Interruption Loan Scheme (CBILS)

Companies given pension payments holiday

The Pensions Regulator has said employers should be allowed to suspend or reduce their pension deficit repair contributions for three months, with the agreement of trustees, to ease pressure amidst the coronavirus crisis. Companies in the FTSE 100 and FTSE 250 pay between £12bn and £15bn in pension repair payments a year. Separately the government is to cover the employer national insurance and minimum auto-enrolment pension scheme contributions on the wages they pay staff furloughed due to the coronavirus outbreak. The Treasury says the extra cover could save firms £300 a month per employee.

Source: NACFB. BBC News.

Retirement

Interest rates cut to record low

The Bank of England has cut interest rates again in an emergency move as it tries to support the UK economy in the face of the coronavirus pandemic. It is the second cut in interest rates in just over a week, bringing them down to 0.1% from 0.25%. Interest rates are now at the lowest ever in the Bank's 325-year history. The Monetary Policy Committee decided on the 0.15 percentage point cut at an emergency meeting where it also announced it would buy £200bn in bonds as part of expanded quantitative easing measures, taking its QE programme to £645bn.

Source: NACFB. BBC News.


CBI wants PM to avoid creating red tape for businesses

The Confederation of British Industry (CBI) has appealed to the Government to ensure red tape for businesses is limited in the trade deal it seeks with Brussels. Carolyn Fairbairn, CBI director general, said: “All efforts must be made in these talks to save exporters time and money, avoiding new paperwork, costs and delays.”

Source: NACFB.


Landlords should put cash elsewhere from April

The number of buy-to-let investors has fallen to a record seven-year low, according to Hamptons International, and the Telegraph's Harry Brennan warns that many more will leave before it becomes more costly in the new tax year. Brennan suggests that investors instead look to property funds and the Enterprise Investment Scheme (EIS) – high-risk venture capital funds that channel money into small and emerging UK businesses. The Government offers generous tax breaks as an incentive to support smaller, growing business, he notes, including 30% income tax relief and the ability to defer CGT.

Source: NACFB.


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