One of the first and largest Islamic property finance transactions has been restructured by Lloyds Banking Group, putting one of London’s largest luxury residential developments back on track.
Lloyds has agreed a new banking facility with Park Lane Properties, a joint venture between Kuwaiti investment firms Adeem, Investment Dar and Stehwaz Holding, which teamed up in 2008 to redevelop the Grosvenor House Apartments, a 1930s building on Park Lane, W1, behind the Grosvenor House Hotel.
PLP drafted in renowned designer Anouska Hempel for a scheme with 133 luxury flats.
The company arranged a £112m murabaha, a type of sharia-compliant loan often used to provide development finance to property companies from the Middle East.
At the time, the loan, provided by Lloyds TSB, was the largest of its kind in UK property. However, work on the project was halted in January 2009 because the original loan had matured and had not proved sufficient to fund the costs of the project.
New funding has now been secured from Lloyds, additional equity has been put into the deal by PLP and work on the project has recommenced and will be completed in April 2011.
The most recent set of accounts filed for Grosvenor House Apartments state that the company needed to find additional funding to complete the project, amounting to £58m.
Mahmoud Samy, a spokesman for PLP, said: “Our commitment to deliver one of London’s most prestigious projects has remained steadfast, as has our relationship with Lloyds Banking Group whose commitment to this unique development has not wavered, even through the worst of the global economic turbulence.”
Mark Coomber, property relationship director at Lloyds Banking Group, said: “The bank has always considered the Grosvenor House Apartments to be a prime asset in a prime location. That, coupled with Lloyds Banking Group’s ethos of forming deep customer relationships, ensured that we were able to assist our customer through very difficult market conditions to a point where this prestigious scheme could be recommenced.”
mike.phillips@estatesgazette.com
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