Arc & Co. arranges £1.2m refinance of complex buy-to-let portfolio

02 February 2026

Dieter Kerschbaumer, Asset Finance Advisor at Arc & Co., has successfully completed a complex £1.2m buy-to-let refinance for a portfolio of five residential apartments.

The client’s company structure included a majority shareholding held by foreign nationals, with the property portfolio held within a wider group structure.

Furthermore, two of the properties were within a UK SPV ultimately registered to a Mauritian company.

The five assets being remortgaged were spread across two SPVs with ownership split among five shareholders, the majority of whom (>75%) were based in South Africa.

The transaction involved navigating cross-border shareholdings and restructuring at the SPV level to meet the lender’s KYC requirements and maximise leverage.

The challenges faced included:

1. A limited market for foreign national buy-to-let mortgages, and the majority of funders supporting these types of clients cap at 65% LTV.
   
   
2. Most funders classify South Africa as a high-risk jurisdiction, and therefore most were unable to support the loan due to their internal funding line restrictions.
   
   
3. Two of the assets were held in a UK SPV with ultimate ownership traced to a Mauritius company. This ruled out funders that needed ultimate ownership in the UK and required enhanced due diligence on the KYC checks.
   
   
4. Most funders require overseas shareholders to sign loan documents. Given the majority of the shareholders were based in South Africa, this requirement could have delayed the refinance process.

Through Arc & Co.’s diverse network of funding partners, Dieter was able to identify a lender who could support the client’s funding requirements based on the proposed restructuring of the corporate structure.

1. The funder agreed that the two assets in the SPV owned by the Mauritius company could be transferred to the other SPV already held by the UK group, eliminating the need to purchase the asset into the group and the requirement for enhanced due diligence.
   
   
2. The ownership at the SPV level was restructured, with the Holding Co holding a 96% shareholding and the two UK Directors holding a 2% shareholding each. This reduction in the South African shareholders' ownership of the SPV (from 25% to 24%) made the lender comfortable accepting a minority shareholder waiver agreement by the SA directors, a measure that avoided the need for them to complete the full loan documents overseas.
   
   
3. The funder also allowed Lightfoots to act as dual representative on the legal documentation. As Lightfoots had previously acted for the clients on a separate transaction, they had all client information on record, which enhanced the speed of the legal process.

Arc & Co. successfully secured:

• £1.2 million refinance facility
• Five-year fixed rate from a challenger bank at 5.89%
• No loan documents signed by the South African shareholders; minority shareholder agreements used instead.
• A company structure that enabled optimised leverage otherwise unavailable to foreign nationals.

This transaction showcased Arc & Co.’s expertise in managing complex transactions that feature international ownership, sophisticated corporate structures, and rigorous KYC requirements.

Dieter commented:

“It was great to structure a solution with the borrowers that enabled a smooth transaction and unlocked leverage that wouldn’t otherwise be available in a limited market for foreign nationals. The borrower’s proficiency and bank’s commercial approach were key to the successful end result”.