Incorporation of £4,500,000 Property portfolio
The client had a portfolio of 22 properties located in the West London. Many of these properties had been owned for many years, but in personal names. This left the client with a number of issues including the tax set up of the portfolio. The main issues here were as follows.
– Unable to refinance existing mortgages as they were in personal names
– Lack of current liquidity for client
– There was no succession planning
The Professional Team
Mesa Financial was introduced to this particular client by their accountant Goldbridge Partnership. Goldbridge Partnership has advised the client to incorporate the portfolio. The benefits of incorporation is the client could claim incorporation relief. This meant the assets could go into the limited company without costing the client stamp duty or capital gains (we are not tax advisers and this should not be deemed as advice). As the existing lenders would not allow their debt the move into a limited company, Mesa Financial was introduced to assist.
The client refinanced their entire portfolio into a single manageable loan of £3.1m, which looked as follows.
– £3,100,000 Lending
– £4,500,000 Portfolio Value
– Interest rate – 5 yr fixed at 3.35%
– LTV – 70%
– Interest Only
– Cash released – £400,000
The outcome solved the initial issues, allowed our client to release cash which will be used to expand property portfolio. The business is no incorporated and will allow future growth plans to be a lot easier to manage, as well as a clear succession plan built into the portfolio.