International property group Strawberry Star has secured a £10m loan to support its plans to convert retail space in Harlow, Essex, into a residential scheme.
The firm is aiming to acquire 110,000 sq ft of retail space. It has planning consent to demolish the property and build 447 flats, a mixture of for sale and rental.
It has borrowed the funds for a 12-month period from specialist property lender Octopus Property.
Part of the Harvey Centre, the property comprises three buildings and is currently let to 39 tenants, with the majority on short leases.
Alongside the residential units, comprising a mix of studio, one- and two-bedroom homes, the scheme will deliver 43,200 sq ft of ground-floor retail across four separate blocks.
The scheme is a 15-minute walk from Harlow Town railway station, which provides a direct service to London Liverpool Street in 30 minutes.
This will be the eighth time that Octopus Property has funded Strawberry Star.
Other deals have supported commercial acquisitions, refinancings and a VAT loan. The funds are being provided by Octopus Property’s Commercial Real Estate Debt Fund II.
Ludo Mackenzie, head of commercial property at Octopus Property, said: “We are seeing an increasing number of opportunities to finance schemes where borrowers have recognised the potential to extract value from change of use, while at the same time playing a key role in the placemaking process that is under way in many urban centres across the UK.”
Santhosh Gowda, chairman, Strawberry Star Group, said: “We are securing opportunities for our volume housing vision aimed at offering London lifestyle homes in the commuter belt towns.
“Harlow, as one of the leading regional housing markets, is an important addition to our development pipeline.”
Strawberry Star is aiming to deliver 4,000 homes by 2025.
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