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Case Study: Semi-Commercial Property Refinance – 1 Shop & 4 Flats

Financing Semi Commercial Property: Contact Advocate Finance

Periodically, we come across cases that we believe property investors would be interested to learn about. The summary below is one such case. We hope you find it helpful.

The Semi-Commercial Property

This property was a multi-unit freehold block of flats (MUFB) consisting of 5 separate units situated on a commercial High Street in London.

The 5 units consist of 1 commercial shop let to a tailors and 4 residential flats.

The building is made up of 3 stories:

  • The commercial unit being on the ground floor
  • The 4 flats being situated across the ground, first and second floor.
  • Two of the four flats were also below 25 sqms.

For many lenders in the market, there is not much of an appetite to lend on these types of properties. Therefore, the level of expertise required to be able to find a solution is far greater than the knowledge needed to place a deal for a simple BTL mortgage.

Fortunately, here at Advocate Finance as specialist advisers, we were able to complete the above case with very few issues from start to finish. The key points are as follows:

Client Background

Our client is a very experienced landlord who has owned this property for over 25 years. They have successfully managed the changeover of tenants in both the commercial and residential units for many years now without any voids.

They also own 3 other multi-unit blocks of flats in the same area – these however are all solely residential properties with no commercial aspect. 

Client’s Requirements

Our client wanted to refinance this property which was held in their personal name, to capital raise for further property investment as a lot of equity has been created in the property over the years.

They were estimating the property to be worth £1.25 million, with an outstanding mortgage of circa £365,000.

The property generates £92,400 a year in rental income.


After speaking with the client and understanding what they wanted to achieve, I reached out to the appropriate semi-commercial lenders that can lend on this asset class with a full client/property referral, so we knew exactly what options we had to choose from when presenting the client with the quote.

We proceeded with the most competitive option and instructed the valuation. The property was valued at £1,230,000, with a vacant possession value of £1,100,000 and the lender was able to provide a net loan of £815,000 on this occasion.

This allowed the client to redeem the existing mortgage but also raise circa £450,000 for further property investment.

Also, this lender was able to use title insurance during the legal process, which saved the client a huge amount of time and enabled the loan to be completed within a few weeks of the offer being issued. Without this being available, it could taken 8-12 weeks to complete a full title investigation on a complex property.

Client Feedback

“I had cause to use the services of Henry of Advocate Finance recently for the remortgage of a semi-commercial property and can attest to his versatility, resourcefulness and extensive knowledge of the industry. Henry always found a solution to every situation that needed to be resolved.

He presented practical resolution of every issue and was not shy of reverting to the lenders in seeking solutions to any apparently intractable issue.

I will always seek Henry out first for my future purchases and remortgages of my BTL portfolio. He is highly recommended!”


How can Advocate Finance help?

Are you interested in refinancing a semi-commercial property with the view of raising capital? Or maybe you are looking to improve your current interest rate?

Whether you need a mortgage on a property you already own or for something similar to purchase a new investment, we will be able to find you a solution to meet your specific needs.

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Picture of Henry Barley

Henry Barley

Senior Property Finance Adviser | | 01206 544333
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Picture of Henry Barley

Henry Barley

Senior Property Finance Adviser | | 01206 544333