Refinance & equity release, Andalusian estate

Owners’ situation and objective

The owners held an unencumbered rural estate in Andalusia valued at €4m. They wanted to raise working capital for a UK business acquisition but did not want to sell the Spanish property. The finance therefore had to release usable capital while preserving long-term ownership of an asset outside the UK.

Refinance requirement

A €2.2m facility represented 55% of the estate’s value. The proposed 15-year interest-only term was designed around capital release rather than a purchase. Because the security was a rural Spanish estate, lender appetite and valuation treatment were as important as the owners’ reason for borrowing.

• €4m unencumbered Andalusian estate
• €2.2m capital release at 55% LTV
• 15-year interest-only structure
• Funds required for a UK business acquisition

Specialist lender selection

Clifton facilitated the transaction through specialist partners who identified a Spanish lender comfortable with both the rural asset class and its location. The application set out the property value, proposed leverage and intended use of funds so the refinance could be assessed as a coherent cross-border capital-raising transaction.

Outcome

The refinance released the required working capital and the UK business acquisition completed on schedule. The family retained the Andalusian estate rather than selling it to fund the acquisition. This outcome reflects the value of considering existing Spanish property as security where a conventional residential purchase mortgage does not match the purpose of the borrowing.