Repair House - Working Capital Solution

Repair House is led by Luke Fox. The business set out to convert a commercial building into a set of high-end apartments. The renovation programme was planned, the numbers stacked up, and the path to leased income was clear. The piece that needed work was how to fund the build.

How the banks read the project

Most banks looked at the proposal and saw a development. Their preferred way to fund it was a single development loan, fully drawn at the start. Under that approach, the full loan sits on the books from day one and interest is paid on the whole amount across the entire build.

That structure suits a ground-up commercial development with a tight delivery programme. A conversion runs differently. Costs land in stages, decisions evolve as the building comes apart, and there is a quiet period at the end where apartments are leasing up before income lifts. Paying interest on money that hasn't been spent yet adds cost the project does not need.

Luke wanted a working capital facility. Sized for the conversion, drawn down only as costs came in, and able to roll into longer-term funding once the apartments were earning.

Tendering the brief

Finance Link prepared the case and took it across multiple banks. The brief was specific:

• Treat the project as a commercial conversion, not a ground-up development
• Provide working capital that can be drawn as needed
• Sit alongside Repair House's existing operations without disrupting them
• Build in a clean roll into long-term funding once apartments are leased

The responses varied widely. Some banks held to the development loan view. Others saw the logic but priced the flexibility too heavily for the project to carry. One bank produced a facility that fit the brief, with terms that worked for both the build and the leasing period that follows.

The outcome

Repair House has a working capital facility in place. Funds are drawn as the build progresses, so interest only runs on money that has actually been spent. Once apartments are leased and rental income is steady, the facility moves in stages into a longer-term loan structured around the building once it is earning.

That shift in shape matters. It keeps costs down through the build, and it removes the rush to refinance that usually shows up at the back end of a development loan. The funding follows the project rather than working against it.

For owners thinking about similar conversions, the harder question is rarely whether finance is available. It is whether the loan on the table reflects how the project will actually run.