Atom bank supports purchase of pub-turned-PBSA with £2.7m loan

17 June 2025

Atom bank, the UK’s highest rated mortgage lender on Trustpilot, has provided a £2.7 million loan to support the purchase of a former pub which has been converted into Purpose Built Student Accommodation (PBSA).

The property in Leicester has been converted into a 55-unit apartment block, delivering specialised accommodation to the city’s students.

The borrower is an experienced investor, with a portfolio of more than 50 residential properties. They wanted to diversify into commercial and student accommodation, and could demonstrate a background in supported accommodation.

The broker, Shannon Harwood of Premier Commercial Lending, said that while other lenders were keen on the case, Atom bank stood out because of the simple terms, lack of caveats, and clear appetite to work with the borrower from the beginning.

Atom bank offered a loan of almost £2.7 million, at an LTV of 62%, with a rate of 8.1% fixed over five years.

Atom bank recently improved its lending proposition for PBSA to provide more favourable maximum loan-to-values (LTV) than are available on Houses in Multiple Occupation (HMOs), a move which means it can support more owner operators and property investors active in the sector. Subject to credit quality, the digital lender will lend up to £5m at 75% LTV and £10m at 70% LTV.

The need for PBSA is stark, with research from CBRE reporting record-high occupancy rates, while ONS data states the number of HMOs - a go-to option for many students - has dropped by 9.5% since 2018.

Neil Findlay, Regional BDM at Atom bank, commented:

“PBSA is becoming more attractive as an asset class, with higher returns than many other forms of commercial property as well as a clear need from the nation’s student population. This case demonstrates our determination to support those active in this space, and by improving our proposition we will be able to work with a broader number of both owner-occupiers and property investors in the PBSA market.”

Shannon Harwood, Head of Bridging and Commercial at Premier Commercial Lending, said:

“My previous positive experience with Atom bank meant I was confident they would be able to support this borrower, and they did not disappoint. The BDM team, in particular Emma Vardy, were incredibly supportive and quick to respond to issues, while the underwriters were very proactive, ensuring progress did not slow down post-offer. Assessing the valuation can sometimes drag on for weeks, yet Atom bank reviewed it within 24 hours, which is unheard of.

“The way Atom bank issues terms is incredibly professional compared to other lenders in this space, which really helps provide the client with confidence ahead of receiving a formal offer. I look forward to working with Atom bank on more PBSA deals this year as more investors look to move into the space.”