Successful Refinance of Brewery Loan for Pub in Scotland

Paying a reasonable interest rate on the loan from their brewery, two Glasgow publicans needed to raise a commercial mortgage to repay that loan so that they could be freed of the brewery tie allowing them to buy much more effectively and achieve much higher gross margins. A pricier interest rate would result but the benefits of higher margin more than outweighed the increased finance costs.

Outcome

As the deal progressed, the property’s bricks and mortar valuation came in a little lower than we all hoped, the company’s accounts were a bit weaker than we expected and the clients’ adverse credit profile was a lot worse than anyone thought.

However, teamwork prevailed and the lender, the publicans and Genie Lending all pulled together to get a commercial mortgage offer on the table within six weeks allowing the pub finance to complete in time for the publican to benefit from an early settlement discount that had been negotiated with the brewery.