Investment Property Refinance After Selling a Business

Selling a business doesn’t always mean selling the property it operates from. Many business owners choose to retain the freehold, creating a valuable long-term investment and rental income.

In this case study, Positive Commercial Finance arranged an Investment Property Refinance that allowed our client to retain ownership of their commercial property after selling their business.

The Situation

Our client had successfully operated a newsagent for many years and had decided it was the right time to retire.

A buyer had been found for the business, but the client wanted to keep ownership of the freehold and lease the premises to the new operator. This would provide a regular rental income while allowing them to benefit from future capital growth.

The Challenge

The existing mortgage had been arranged on an owner-occupied basis.

When the client asked their current lender to convert the loan into an investment property facility, the request was declined.

As a result, they needed a lender that understood commercial investment properties and was prepared to refinance the property based on its new investment use.

Our Solution

Positive Commercial Finance approached a range of specialist commercial mortgage lenders with experience in investment property finance.

We obtained several competitive offers and compared the available options with the client, considering borrowing levels, interest rates and long-term flexibility.

The client selected a 75% Loan to Value (LTV) investment property mortgage that met both their immediate and future financial objectives.

Deal Structure

• Loan to Value (LTV): 75%
• Interest Rate: 5.19% fixed for five years
• Arrangement Fee: 1.5%
• Repayment Type: Interest Only
• Term: 10 years

The Result

The new mortgage repaid the client’s existing owner-occupier loan and successfully converted the property into a long-term investment.

In addition, the refinance released surplus equity, providing capital for future property investments while allowing the client to generate rental income from the building they had owned for many years.

This case highlights how the right Investment Property Refinance can support business owners as they transition into retirement while helping them maximise the long-term value of their commercial property.