Large scale funding for a major practice development project - £1.4 million funding agreed in days
Thanks to a combination of high standards and the perfect location at the heart of an affluent area, a Richmond dentist was enjoying a level of demand for his services that his practice simply could not accommodate.
Within five years he had outgrown his existing premises and saw that there was no longer any scope for further expansion.
However, he did recognise that the location of his practice was one of the most important factors behind its success. He needed more space to grow his business - but could not put his practice and the goodwill he had built up in it at risk by moving it.
He saw that the solution was to turn his single practice into two. His existing surgery would remain where it was and, with two extra chairs, would concentrate on the core dental work. However, it would be joined by a second facility that would concentrate on dental hygiene and cosmetic treatments.
The practice would, therefore, be spread across two buildings, but it was felt that the split would be the best solution for patients.
However, the key to the success of the plan would be in securing additional premises nearby. When a suitable building became available he acted fast to express his interest - but to secure it, and to provide the necessary refurbishment and kitting out, he would need to raise a total of £1.4 million.
He was confident that the success of his current business would support this level of borrowing. However, when he approached brokers he found himself frustrated by a lack of progress.
When the brokers were unable to secure the funds he needed after 3 months of trying, and the deal looked as though it would fall apart because of the delays, he came to Rangewell.
We arranged an Offer in Principle in two days - helping save the deal which was crucial to the future of the business.
An innovative solution
We were able to secure the deal when others could not because of the way we work. Our service is personal - and provided by an expert team who have experience working with lenders, including Tier 1 banks.
It means we can identify financial solutions when others can only see problems.
In this case, we saw that the brokers were unable to help because they saw the £1.4million total borrowing required as a 100% loan. This kind of funding is always difficult to arrange - all lenders prefer to see the borrower provide a proportion of the funding from their own resources and, in so, demonstrating their commitment to the project. Their view is that if the borrower shares in the funding of a project, he or she will be more determined to succeed.
However, we looked more closely at the challenge and saw that there was a way to structure the loan which would provide the funding required.
We restructured the loan application to provide £950,000 to buy the freehold property with a loan secured on the property itself, and £450,000 - to provide the refurbishment and new equipment required - secured on the goodwill of the existing practice.
We then used our personal contacts to get rapid access to decision-makers in a major high street bank and present them with our proposal, supported by evidence of the profitability of the dentist’s business.
The result was not just an Offer In Principle provided in just two days, it meant rates that reflected our client's status as a successful dental practitioner. This offer allowed him to save the deal and secure the property he needed.
Funds were available fast, which meant that he was able to take possession of the property and begin the necessary conversion work in the shortest possible time. His business was able to grow without interruption - allowing him to take on the addition patients he wanted.
As a dentist, coming to Rangewell means getting an expert team working for you and your practice to find the financial answers you need - even when your needs are challenging.