Real Estate Credit Investments plc (LON:RECI) is the topic of conversation when Mark Thomas joins DirectorsTalk Interviews.

Mark talks us through RECI’s sensitivity to rising rates, exposures to borrower sensitivity to both revenue and debt, how RECI mitigates the risk of rising rates and discusses a case study of how RECI managed a hotel exposure through COVID-19.

Real Estate Credit Investments is a closed-ended investment company which originates and invests in real estate debt which is secured by commercial or residential properties in Western Europe, – focusing primarily on the United Kingdom, France and Germany.

Alternative investment fund manager Cheyne Capital Management (UK) LLP (Cheyne Capital) has provided a GBP103 million senior loan to finance the acquisition and development of a residential led mixed-use scheme in Vauxhall, London.

The 279,900 square feet site – named ‘Graphite Square’ – is located within the Vauxhall, Nine Elms & Battersea Opportunity Area and will provide new homes, workspace and amenities for the area. Planning permission has been granted by Lambeth Council for 160 new one to three-bed private homes, 50 of which will be affordable, as well as over 80,000 square feet of workspace and 400 square feet of retail. The affordable housing units have already been sold and the office space has been pre-let on a 12-year lease.

In addition to aiming for a BREEAM rating of Excellent and EPC rating of A, the scheme will include solar PV panels, air source heat pumps, ample cycle storage, green spaces and a children’s play area. Importantly, the affordable homes will have the same access to the scheme’s amenities as the market-rate homes, to create an inclusive community across the development. This requirement is a key tenet of Cheyne Real Estate.

The project is sponsored by highly experienced Australian property developer, Third.i, which has a successful track record in creating large-scale residential, commercial and senior living projects throughout Australia. Graphite Square will be its second major development in London and will meet the highest quality and environmental standards.

The investment comes from the sixth and seventh vintages of Cheyne’s CRECH programme, the firm’s real estate direct lending strategy, which launched in 2011.

An alternative investment fund manager has announced it has provided a senior loan of more than £100 million (£103 million) to finance the acquisition and development of a residential-led mixed-used scheme in Vauxhall, south London.

Cheyne Capital’s funding is for the 279,900 sq ft site – named ‘Graphite Square’ – situated within the Vauxhall, Nine Elms & Battersea Opportunity Area, which also includes Battersea Power Station and a range of other new developments.

Graphite Square will provide new homes, workspace and amenities for the area, with planning permission granted by Lambeth Council for 160 new one to three-bed private homes, 50 of which will be affordable, as well as over 80,000 sq ft of workspace and 400 sq ft of retail. The affordable housing units have already been sold and the office space has been pre-let on a 12-year lease.

In line with the recent trend for greater sustainability, the scheme will include solar PV panels, air source heat pumps, ample cycle storage, green spaces and a children’s play area, as well as aiming for a BREEAM rating of Excellent and an EPC rating of A.

Those behind the scheme insist that the affordable homes will have the same access to the scheme’s amenities as the market-rate homes, to ‘create an inclusive community across the development’ – a requirement that is a key tenet for Cheyne.

The project is being sponsored by ‘highly experienced; Australian property developer, Third.i – a firm with a successful track record in creating large-scale residential, commercial and senior living projects throughout Australia. Graphite Square will be its second major development in London and will aim to meet ‘the highest quality and environmental standards’.

“This investment not only underscores Cheyne’s commitment to working with experienced sponsors which have a thoughtful vision to build sustainable developments that will benefit the whole community, but also our continued interest in investing in multi-purpose sites,” Arron Taggart, head of UK real estate at Cheyne Capital,said.

“We’re pleased to be partnering with Third.i on their second London development and look forward to working together to bring high quality and affordable homes, offices and retail space in this desirable location.”

Ron Dadd, global managing director at Third.i, added: “We’ve been looking for exciting opportunities in London for some time, and Graphite Square is the perfect embodiment of our belief in creating better places to live, work and play. We instantly fell in love with the architecture and place making of the project, seeing it having an ageless appeal that will become a legacy project, one we all can be proud of.”

He went on: “It’s a development which we believe can have an incredible effect on the Vauxhall area and the prospects of all its residents, and we are very proud to be working with partners who passionately share our beliefs and desire to make this happen. We all look forward to working closely with Lambeth Council and the local community to bring our plans to fruition.”

The investment comes from the sixth and seventh vintages of Cheyne’s CRECH programme, the firm’s real estate direct lending strategy that was launched in 2011.

Alternative investment fund manager Cheyne Capital Management (UK) LLP (Cheyne Capital) has provided a GBP103 million senior loan to finance the acquisition and development of a residential led mixed-use scheme in Vauxhall, London.

The 279,900 sq ft site – named ‘Graphite Square’ – is located within the Vauxhall, Nine Elms & Battersea Opportunity Area and will provide new homes, workspace and amenities for the area. Planning permission has been granted by Lambeth Council for 160 new one to three-bed private homes, 50 of which will be affordable, as well as over 80,000 sq ft of workspace and 400 sq. ft. of retail. The affordable housing units have already been sold and the office space has been pre-let on a 12-year lease.

In addition to aiming for a BREEAM rating of Excellent and EPC rating of A, the scheme will include solar PV panels, air source heat pumps, ample cycle storage, green spaces and a children’s play area. Importantly, the affordable homes will have the same access to the scheme’s amenities as the market-rate homes, to create an inclusive community across the development. This requirement is a key tenet of Cheyne Real Estate.

The project is sponsored by highly experienced Australian property developer, Third.i, which has a successful track record in creating large-scale residential, commercial and senior living projects throughout Australia. Graphite Square will be its second major development in London and will meet the highest quality and environmental standards.

Arron Taggart, Head of UK Real Estate at Cheyne Capital, says: “This investment not only underscores Cheyne’s commitment to working with experienced sponsors which have a thoughtful vision to build sustainable developments that will benefit the whole community, but also our continued interest in investing in multi-purpose sites. We’re pleased to be partnering with Third.i on their second London development and look forward to working together to bring high quality and affordable homes, offices and retail space in this desirable location.”

Ron Dadd, Global Managing Director at Third.i, says: “We’ve been looking for exciting opportunities in London for some time, and Graphite Square is the perfect embodiment of our belief in creating better places to live, work and play. We instantly fell in love with the architecture and place making of the project, seeing it having an ageless appeal that will become a legacy project, one we all can be proud of. It’s a development which we believe can have an incredible effect on the Vauxhall area and the prospects of all its residents, and we are very proud to be working with partners who passionately share our beliefs and desire to make this happen. We all look forward to working closely with Lambeth Council and the local community to bring our plans to fruition.”

The investment comes from the sixth and seventh vintages of Cheyne’s CRECH programme, the firm’s real estate direct lending strategy, which launched in 2011.

A lively Q&A session, moderated by HVS chairman Russell Kett, addressed factors likely to hamper recovery progress. ‘The challenge around financial forecasting particularly if you have London hotels, as well as the pace of the change – when will it come back and how will it come back,’ was a key issue for Arron Taggart of Cheyne Capital, with travel restrictions, lack of airlift and scarcity of MICE business highlighted by Jan-Willem Terlouw of Westmont Group.

Edwardian Hotels’ Peter Anscomb said the difficulty was the inability to predict hotel performance, which was ‘purely down to what the [Covid] restrictions allow’.

Environmental, social and corporate governance [ESG] has become a growing issue, said panellists. ‘We are being pushed incredibly hard on ESG now,’ said Taggart. ‘One of the key challenges is whether corporate travel will come back; if it does, it’s not going to be as before as it’s not consistent with ESG policies.’

Barclays Bank’s Tim Helliwell, citing recent research, said that Generation Z will pay a 30% premium for ESG. The panellists predicted a time that lenders wouldn’t lend to businesses that weren’t carbon neutral.

Whether or not branded hotels were in a better position going forward was also under debate, with some panellists arguing that assets and location had become more important than brand values.

‘Flexibility is now very important and brands can be very restrictive,’ commented Louise Gillon of Bank Leumi. She advised operators to be clear about their core business and to be realistic about what you can achieve over the next four to five years.

Manchester-based property and construction advisory firm Russell Bolton Consulting has been appointed to projects worth £62m.

The business has landed a trio of new project commissions from North West residential developer Mulbury.

The company, which was founded earlier in 2021, has won the cost management and employers agent role on three Mulbury schemes in Manchester’s New Cross district.

Projects include a £23m, 144-unit scheme on Oldham Road which will comprise one, two and three-bedroom apartments.

The properties will be created over 12 storeys with a resident’s lounge, roof terrace and ground floor commercial space.

It has been forward funded by Cheyne Capital Real Estate with the site expected to be complete by June 2023.

The second project is on neighbouring Bendix Street and is a £27m, 13-storey development of 161 units, expected to be completed by the end of 2023.

The final commission is on Mulbury’s Goulden Street project, a £12m, 73-unit development across eight stories. Work will commence before the end of 2021 and will be completed by mid-2023.

Tim Groom Architects has designed all three schemes with Deloitte Real Estate acting as planning consultant on the developments.

The Russell Bolton Consulting team is being led by Russell Bolton and David Litherland.

Russell Bolton, co-founder and director, said: “It’s exciting to be working with Mulbury and part of a project that will see further regeneration of Manchester’s New Cross area and deliver a range of social, economic and environmental benefits.”

Australian property developer Third.i has acquired its second major mixed-use development site in Vauxhall, south London.

The 279,900 sq ft site, located on Vauxhall Walk, was purchased from Bmor, who acted for the previous owners in obtaining the planning permission for the development for 160 new homes and co-working office spaces for residents and local businesses.

The £200m GDV Graphite Square scheme will consist of one- to three-bedroom new homes, 50 of which will be affordable houses, over 80,000 sq ft of co-working space across four floors, three residential buildings ranging from nine to 13 storeys in height, 14 disabled parking spaces, a Methodist Church and landscaped communal gardens with elements to enhance biodiversity.

The scheme will be designed by Ben Adams Architects, while Trigon and Cheyne Capital were selected as lead consultant and funding partner, respectively.

The developer will be working together with Vision Construct and Halkin for the construction of the scheme, with the latter having signed a lease to manage and deliver the turnkey office and co-working spaces.

Third.i has also partnered with Paragon Asra Housing to develop the affordable homes, 14 of which will be available to purchase under shared ownership and 36 for affordable rent.

The acquisition follows Third.i’s successful UK debut in Battersea in 2018, as it seeks to invest around London in residential, commercial, senior living and assisted living projects.

Luke Berry, founder of Third.i, said: “We’ve been looking for exciting opportunities in London for some time, and Graphite Square is the perfect embodiment of our belief in creating better places to live, work and play.

“We instantly fell in love with the architecture and place making of the project, seeing it having an ageless appeal that will become a legacy project, one we all can be proud of.

“It’s a development which we believe can have an incredible effect on the Vauxhall area and the prospects of all its residents, and we are very proud to be working with partners who passionately share our beliefs and desire to make this happen.

“We all look forward to working closely with Lambeth Council andthe local community to bring our plans to fruition.”

Manchester-based property and construction advisory firm, Russell Bolton Consulting, has landed a hat-trick of new project commissions from North West residential developer, Mulbury, as part of a £62m package.

The King Street-based firm, which was founded earlier in 2021, has won the cost management and employers agent role on three Mulbury schemes in Manchester’s New Cross district.

The projects include a £23m, 144-unit scheme on Oldham Road which will comprise one-, two- and three-bedroom apartments created over 12 stories with a residents’ lounge, roof terrace and ground floor commercial space. The scheme has been forward funded by Cheyne Capital Real Estate with the site expected to be complete by June 2023.

The second project is on neighbouring Bendix Street and is a £27m, 13-storey development of 161 units, expected to be completed by the end of 2023.

The final commission is on Mulbury’s Goulden Street project, a £12m, 73-unit development across eight stories. Work will commence before the end of 2021 and will be completed by mid-2023.

Tim Groom Architects has designed all three schemes with Deloitte Real Estate acting as planning consultant on the developments.

The Russell Bolton Consulting team is being led by Russell Bolton and David Litherland.

Russell Bolton, co-founder and director, said: “It’s exciting to be working with Mulbury and part of a project that will see further regeneration of Manchester’s New Cross area and deliver a range of social, economic and environmental benefits.”

Greg Mulligan, a director of Mulbury, said: “We’re delighted to be working with Russell, David and the wider team and to be able to call upon their significant technical expertise and commercial know how.”

Russell Bolton Consulting was founded in February 2021 after Russell Bolton and David Litherland left their senior roles at Rider Levett Bucknall to launch the firm.

David Litherland said: “We have been amazed at the support from clients and partners since we launched.

“We have been commissioned on a number of exciting projects across residential, leisure education and industrial sectors, while growing the team with some new hires.”

The theme of the latest in the series of seminars hosted by HVS together with legal expert Bird & Bird, publishing group EP Business in Hospitality and restructuring advisory firm AlixPartners was resetting the hotel balance sheet to be fit for the recovery, and fittingly was the first in the series to be held as a hybrid event, with some 60 participants gathering in person in central London, while an international audience watched and asked questions over zoom.

Graeme Smith, head of hospitality & leisure at AlixPartners, considered the support received by hotels from lenders during the pandemic itself and looked at the prospects for restructuring over the months ahead.

James Salford of Bird & Bird explored the future of travel itself, touching on the recovery in leisure travel driven by the Staycation trend, and the impact on business travel from the adoption of new technologies, and the consequences for lending and development finance.

These presentations were followed by a lively panel discussion from guests including Peter Anscomb of Edwardian Hotels, Louise Gillon from Bank Leumi, Tim Helliwell of Barclays Bank, Arron Taggart from Cheyne Capital and Jan-Willem Terlouw of the Westmont Group, moderated by Russell Kett, Chairman of HVS.

The real estate investor has bought Mulbury’s 161-home development on Bendix Street in the city’s New Cross district.

Europa Capital has entered into a forward funding agreement for the 12-storey Manchester scheme as it looks to build its build-to-rent portfolio.

“Against the backdrop of a significant shortage of housing in the UK, the build-to-rent sector has proven its resilience during the pandemic, as well as from wider structural change,” said Jason Oram, partner, fund manager at Europa Capital.

“During times of high inflation, the asset class has historically been a very good hedge and for these reasons institutional investors are increasing their capital allocations to the sector.”

Europa made the acquisition on behalf of its latest value add fund, Europa Fund VI. The value of the investment was not disclosed.

The 138,000 sq ft development will feature a mix of one-, two- and three-bedroom apartments as well as a 1,700 sq ft of commercial space.

GMI Construction has begun work on the Bendix Street project, which has a GDV of £37m and is due to complete by the end of 2023.

This is the second residential scheme to be delivered by Europa Capital in Manchester since the successful launch of Renaker’s Anaconda Cut, a 44-storey tower that is currently the tallest building in Salford.

In total, Europa Capital has invested around £1bn in residential schemes across Europa over the last decade.

Martin Bury, co-founder and director at Mulbury, added: “This deal marks another significant milestone in the regeneration of New Cross and will contribute hugely to the area’s ongoing transformation into a vibrant and thriving part of the city.

“We’re thrilled that Europa Capital share our vision for the site and our ambition to provide exciting city living opportunities that help Manchester deliver on its homes strategy.”

Mulbury won approval for the Bendix Street project last December. The development, designed by Tim Groom Architects, is one of three schemes the developer is bringing forward in Manchester’s New Crossneighbourhood.

Earlier this year, investor Cheyne Capital Real Estate agreed to forward fund another of Mulbury’s New Cross schemes, a £32m 144-apartment development on Oldham Road.

The developer’s third New Cross venture is the 73-apartment Peeler’s Yard on Goulden Street.