Gross loan £257,905 · 12-month term · GDV £425,000 · 61% LTV
Albatross Lending Group provided £257,905 of refurbishment finance to fund the purchase and full conversion of a vacant three-bedroom mid-terrace in Stoke-on-Trent into a six-bedroom, all-ensuite HMO. A day-one net advance of £63,333 contributed towards the £118,000 purchase price, with the shortfall covered from company reserves and a further £157,520 drawn in arrears to fund the works. With interest rolled for the full twelve-month term, the borrower had no monthly servicing obligations – freeing up cash flow to focus entirely on delivering the product.
The security is a freehold mid-terrace house located half a mile northwest of Stoke city centre, in a high-density residential area with strong HMO demand. Stoke Railway Station, Staffordshire University, and the Royal Stoke University Hospital are all within half a mile. The surveyor applied an all-risks yield of 9.25%, in line with comparable all-ensuite HMOs in the area, arriving at a GDV of £425,000, with the completed property estimated to generate £4,200 per month at full occupancy across six rooms ranging from £650 to £800 per month.
The work covers a full strip-out and reconfiguration, complete rewire and replumb, installation of six ensuite bathrooms, a new kitchen, roof extension, and full second-fix fit-out throughout and are expected to take five to six months under building control oversight.
The borrower is an established property investment company with nine existing properties across Stoke, a portfolio valued at approximately £1.8 million, and a net rent roll of around £7,700 per month. This is their fifth HMO conversion, their most recently completed project was purchased for £150,000, required £90,000 of works, and is now valued at £270,000 generating £2,700 per month.
This deal was introduced by a broker with a strong track record of bringing us quality refurbishment opportunities, the kind of relationship that allows us to move quickly and back the right borrowers with confidence.
Through its specialist divisions, Albatross Lending Group offers a comprehensive range of market-leading finance solutions across the residential, commercial, and SME sectors. From bespoke short-term bridging and refurbishment finance to longer-term asset-backed facilities, Albatross structures flexible solutions to support growth, investment, and portfolio development across the UK property market. By delivering practical and tailored funding, Albatross Lending Group enables operators and investors to execute complex projects with confidence, safeguarding the continuity of operations and ensuring value creation.