The loan is used to release equity capital and increase the operating capital of the company.
The loan will be repaid by refinancing, from the sale of the collateral property, or from the incoming business revenues of the company.
The loan is secured with a first rank mortgage.
The collateral for the loan is a 6-story commercial office building (4.490 m2) located in Pohjois-Haaga, Helsinki. Pohjois-Haaga is a district of Helsinki located 10 km to the North of Helsinki city centre with good public transport connections and easy access by vehicles.
The asset is currently valued at 10.100.000 € and after fully leased the value is estimated to increase to 11.400.000 €. Once fully leased, the estimated rental income per year is 1.067.040 €.
The borrower plans to fully lease the office building and re-finance the Estateguru loan with long-term bank financing. Alternatively the group also has other streams of revenue from leasing commercial properties and selling completed development projects with which it can repay the Estateguru loan.
The borrower retains the opportunity to raise additional capital if necessary, provided that the ratio of the loan and the market value of the collateral (LTV) does not exceed 43.0%.
The established mortgage will also cover loans of additional stages of financing.
Prior to the additional stages of financing, construction supervision must confirm the completed works (if construction has commenced and works have been performed in a considerable amount) and a third party must assess the market value of the collateral.
The LTV in the 1 stage is 19.8% and can increase to 43.0% in further stages.