Dragonfly and Capital A Finance bail out Co-Op

Co-operative BankA bridging lender has bailed out a struggling high street bank with a £62.5 million bridging loan, secured against a £100 million portfolio of prime London property.

Dragonfly Property Finance, alongside Capital A Finance, has written a £62.5 million bridging facility for the Co-operative Bank, which was looking to refinance a called-in debt.

This landmark deal for Dragonfly marks its largest ever loan to date, securing the deal on a £100m-valued portfolio of prime central London property owned by an offshore family.

The Co-operative Bank, a mutual looking to plug a £1.5 billion shortfall in its capital, has had a torrid time of late, including a six-notch downgrade on its credit rating by Moody’s.

The Co-operative is currently progressing through a vital recapitalisation strategy, leading to the company seeking short-term financing ahead of securing a more secure long-term solution.

Upon maturity, Capital A and Dragonfly will more than likely aid with the subsequent investment loan, this will be available at far more manageable rates than those of a bridging facility.

Speaking in a statement, Daniel Austin, Chief Executive of Capital A: “The last 12 months have been exceptionally busy for us, with an average of one deal closing every couple of weeks, and we are delighted to have arranged our largest refinancing to date.

“Our access to fluid capital from private sources, our team’s real estate expertise and our appetite to structure complex transactions put us in a unique position within the real estate debt market and we look forward to closing further transactions in the coming months.

“Our investments to date are broadly distributed across commercial and residential assets across London but we are also actively reviewing opportunities outside of the M25.”

Speaking to CoStar, Jonathan Samuels, Chief Executive of Dragonfly Property Finance, said: “Out of the 1,200 loans Dragonfly has advanced since inception, this loan was the largest we have completed.

“We have historically lent in excess of £20m as sole lender but Dragonfly also has a proven track record in working effectively with other lenders and this transaction demonstrates that.

“Due to the speed required for the refinance, the variety of assets, and the complex structures involved, this was an interesting challenge but one that both teams stepped up to the plate on.”