Case Study: Bridging Finance of €375,000 provided in County Dublin
In March 2023, a property investor approached Onate with an ambitious renovation project in Dun Laoghaire, County Dublin for €575,000. Onate swiftly crafted a tailored financing package, allowing the borrower to not only secure the property but also leverage their skills as a structural engineer to unlock its full potential.
The property in question presented a unique prospect. It was a large former retail unit with a residential house making up part of the property, but it required a comprehensive refurbishment. This property offered significant appreciation potential. The borrower, possessing expertise as a structural engineer, was well-positioned to identify the value-added opportunity that lay within this investment and had completed similar projects previously.
Crucially, the borrower had already gone sale agreed on the property when they reached out to Onate and was working through some title issues with their solicitor. Once the title issues were clarified, the pressure was on to complete the transaction rapidly. Within 24 hours of the initial request, Onate issued a term sheet for €375,000, representing a reasonable 65% loan-to-value (LTV) ratio. This expedited process allowed the borrower to proceed confidently with their property acquisition to close out the purchase.
One of the unique aspects of this financing arrangement was Onate's willingness to accommodate the borrower's financial situation. Given that the property required a complete overhaul, Onate agreed to retain interest for the first six months of the loan. This approach alleviated the borrower's concern regarding interest servicing until the seventh month when the property would be completed and generating income. The borrower had another residential property, which had been completed and was on the market. This property was successfully sold in August 2023, and the proceeds were strategically earmarked for repaying the Onate loan. Despite the loan's initial term set at 12 months, Onate imposed no penalties for early repayment, showcasing its commitment to flexibility and a client-centric approach.
With Onate's tailored financing solution in place, the borrower seamlessly navigated the acquisition and refurbishment of the property. As the property began generating income in the seventh month, it steadily contributed to the borrower's financial growth and long-term investment strategy.
For property developers and investors seeking financial partners who understand the intricacies of real estate ventures, Onate's track record of delivering results is a testament to its reliability and expertise.
Contact John Ring john@onate.com/0878305276 or Michael Gavin michael@onate.com/0851454200 for more information.
Why are Special Purpose Vehicles (SPVs) used for Property Finance?
Where property purchasers/developers want to obtain finance for projects, an SPV is typically used as it reduces risks and liabilities for the lender.
One of the primary reasons for the growth in limited companies being registered for buy-to-let purposes is the tax treatment. Instead of paying income tax as an individual, a limited company pays corporation tax.
What is an SPV?
An SPV is a legal company that is formed for a defined special purpose.
For property investors, an SPV is usually formed in order to purchase buy-to-let properties or for property development projects. The SPV is a separate company with separate assets and liabilities.
An SPV for property investment is usually formed as a private company limited by shares.
How to set up an SPV in Ireland?
An SPV limited company is straightforward to set up and is no more complex than setting up a standard limited company. You can direct your solicitor or accountant to set it up or alternatively you can set this up yourself through the Companies Registration Office (CRO) at a cost of €50.
As per a normal limited company, you must appoint a director, register an address and you will be given the relevant reference numbers.
Process:
Form A1 - This is the application form for the company formation. Furnish the necessary details about the company, directors, secretary, shareholders, and share capital.
Company constitution - Compose the company's constitution, which includes information about the company's purpose, internal regulations and governance.
CRO - Submit the completed Form A1, along with the required €50 fee, to the CRO electronically through the CRO Online Registration System (CORE).
Tax Registration – Irish SPVs need to register and pay tax to the Irish Revenue Commissioners through Revenue’s Online System (ROS).
Bank account – Required; company documents Including the certificate of incorporation, the company constitution, and the A1 form.
It is a straightforward process and alternatively you can engage an accountant to incorporate an SPV for as little as €120 including the CRO fees.
Why use an SPV for property investment?
An investor may choose to form an SPV to obtain finance on a property with limited liability.
They may also do so for tax purposes. This is because one of the key advantages of holding a property through an SPV is the propensity to attain a lower overall effective tax rate on the rental income generated from the property.
SPVs, Limited Companies and Mortgages: What you need to know
For property investors who decide to operate their business through a limited company, however, the reason for setting up an SPV is a little more complicated.
The lending policies of most mortgage providers mean it can be more difficult for a trading company (i.e. one which, in addition to owning property, conducts other trading activities) to obtain mortgage finance. It is usually far easier for a limited company whose sole business relates to the property to obtain finance. So, in order to access mortgage finance, it is usually necessary for property investors who use the limited company format to also set up an SPV for property investment and development.
Many investors use bridging loans as a short-term financing solution when establishing SPVs for property transactions. Bridging loans offer quick access to capital, allowing investors to secure deals before arranging longer-term financing.
In practice, the use of SPVs for limited companies has two main benefits: firstly, it makes obtaining financing more achievable and, secondly, it offers them the chance to claim mortgage interest tax relief.
Why alternative lenders prefer SPVs
Alternative lenders tend to prefer limited company SPVs because it is easier to understand the lending risks involved. For example, a new SPV for a property project will be a new business with no previous trading history. It will be free from any pre-existing obligations, debts, charges, and legal claims, which may otherwise affect a lender’s decision on an application.
How an SPV works: A case study
Assume that you are a building contractor and are already trading as a limited company. It may seem to make sense to purchase buy-to-let properties with a mortgage through this company, particularly as you would be able to claim mortgage interest tax relief as a result.
However, as this is a trading company with existing assets and liabilities, debtors and creditors, employees, etc., it may be difficult to find a mortgage lender willing to lend to you.
In this case, setting up an SPV for this purpose should enable you to access commercial property finance more easily.
Some other advantages of using an SPV
SPVs can have several other possible advantages, including:
Placing a property within an SPV can be used to separate and reduce business risk. If, for example, a trading company you own fails (or you wish to dissolve it), this will not affect the property assets within the SPV. Similarly, if a property SPV is unsuccessful it will not affect your trading company.
SPVs can provide a practical and safe way of working with other investors on a specific property project while keeping it separate from your other property projects or other businesses.
SPVs offer flexibility. It is possible to form several SPVs if you wish for different projects to remain independent of one another. An SPV can be formed for one or several related projects. The SPV can be dissolved when the property is sold and new SPVs formed for any further projects.
Placing a property within an SPV means that the property can be sold or transferred by selling or transferring ownership of the SPV.
It is important to note that the property in the SPV is subject to any future changes in legislation, including tax legislation, that may affect this kind of entity.
Summary
In summary, if you are considering your next property purchase or property development venture then using an SPV can offer many advantages. However, it is essential to take professional advice on the overall implications of using an SPV before going ahead so it is tailored and specific to your individual needs, risks, and opportunities. In a nutshell, the process involves setting up an SPV after you find a development, in order to isolate the asset and any risks involved with the purchase. After the property/development project is completed, you either sell it or you keep it, at which point you go through a formal process with your advisors to – if so desired – close that SPV down and possibly establish a new one.
This article was written in conjunction with Tom Heelan, Principal at Thrive Financial . For more information, please contact 087 9344655/info@thrivefinancial.ie.
To contact Onate about property finance, please contact John Ring at john@onate.com / 0878305276 or Michael Gavin michael@onate.com / 0851454200
Case Study: Bridging Finance of €1.4M provided in Dublin
Financing purchase of a residential development site
Financing solutions required with a week
In June 2022, Onate was presented with a unique opportunity by a property investor seeking to acquire a prime residential development site at auction in Dublin 18. This time-sensitive deal required efficient and creative financing solutions to secure the property within a week.
The property in question had full planning permission for the construction of 28 residential units. It was a strategic investment opportunity, but the auction date was just days away. The borrower needed a quick financing solution to secure this property. Recognising the urgency and complexity of the situation, the promoter met with Onate's lending manager. Together, they strategised on how to structure the deal most effectively. It was decided that releasing equity from the borrower's four bedroom residential property in Dublin 18 would be the most efficient approach. This property was already owned in an SPV and had no borrowings against it.
The residential property had an appraised value of €2.1 million, and Onate extended a loan of €1.4 million, representing a 71% loan-to-value (LTV) ratio. Within just two days of the initial approach, Onate issued a term sheet, enabling the borrower to participate in the auction confidently. The speed and certainty of execution provided by Onate played a pivotal role in securing the borrower's trust and facilitating the swift progress of the deal.
Once the residential development site was successfully secured at auction, the borrower promptly paid the due diligence fee. Onate's dedicated underwriting ensured that all necessary procedures were completed within the four-week deadline. The borrower had already arranged for overseas financing to fund the development of the acquired property and to repay the Onate loan. The certainty of repayment was factored into the loan structure, ensuring a clear and viable exit strategy. Onate's swift and flexible financing solution allowed the borrower to seize the opportunity presented by the auction, secure the development site, and proceed with their ambitious residential project. The loan provided by Onate was fully repaid within the 12-month term.
By tailoring a financing package that met the borrower's needs and navigating the 4 week timeline of the auction, Onate showcased its expertise in delivering financial solutions that drives success.
The Importance of an Efficient Property Valuation During the Lending Process
Our lending process is fast paced and simple. We make decisions in house and work with solicitors and valuers who have also bought into our ethos of completing transactions within tight timeframes.
All our loans are subject to a valuation being completed. If the valuation process is prolonged, this in turn slows down Onate’s lending process.
We spoke with Richard O’ Neill, Managing Director of Artis, on the key aspects of completing a valuation efficiently:
1.Understanding the circumstances of the loan and any time sensitivities around it: Our open line of communication with Onate allows us to prioritise cases accordingly. Understanding the situation fully means that we can advise Onate on the likely requirements of the report at the outset, which helps to save time in the long run.
2. Sharing and availability of information: The quick turnaround on valuation is hugely reliant on the relevant documentation and information being provided at the outset. This will typically include copies of leases and any tenancy schedules. It may also include copies of planning permissions and proposed construction costs. Onate has that for us at the outset of instruction, which saves us time and equips us to start drafting the valuation report sooner.
3. Valuer understanding of the market: We know the market that Onate typically lends into very well. We also have a huge level of market experience within the team so are therefore able to soundly advise Onate at the outset of instruction on the likely viability of proposed values. Similarly, given our experience in the market, we have access to a wide pool of comparable data across all sectors. This allows us to build and analyse valuation reports as soon as possible, without compromising on quality or accuracy.
4.Clearing up queries: Our strong relationship with Onate works well. When queries do arise, post instruction, then we are able to quickly raise, discuss and resolve the issue within a very short timescale.
To find out more about Onate’s lending process, call (01) 697 2588 or email hello@onate.com
Onate launches €100m Bond Programme
The Onate team is delighted to announce the establishment of a €100m secured note programme on the Vienna MTF operated by the Vienna Stock Exchange.
Coupled with its multiple senior institutional funding lines, Onate has strong diversity of funding sources and is well placed for further expansion of the business in providing short-term property finance for purchases, renovations, equity release and debt settlements secured against residential investment property, mixed use or commercial property.
Onate is already the third most active non-bank lender in Ireland, completing over 115 loans, totalling over €70 million, in its two years since launch.
Onate’s diversity of institutional funding lines, each of which sees all credit making decisions made in-house, sets them apart from many other non-bank lenders in their ability to execute at speed and deliver transactional certainty.
Onate has drawn €22m of the €100m permissible under the note programme and will continue to draw down funds as its loan book grows further.
Dan Gandesha, Onate CEO said:
“We’ve made our name in the Irish market by delivering a ‘fast yes or no and following through at pace’, regularly delivering property bridging loans in under ten days. We achieve this by making all our credit decisions in-house with our experienced team on the ground here in Ireland. The successful listing of this bond programme allows us to double down yet further on our singular focus of delivering much needed transaction certainty to property deals.”
From the Sunday Independent:
Case Study: Bridging Finance of €760k provided in Limerick
Equity Release Loan
Loan used for purchase and renovation of three properties
In the latter half of 2022, Onate received an inquiry to provide an equity release on a stabilized multi-let residential property in Limerick. The promoter purchased this property in 2021 and carried out a schedule of works in order to improve the property. Upon completion of the works, they were able to secure a long-term lease with a local authority.
The borrower then committed to purchasing three properties in Limerick that required a significant level of renovation and refurbishment works in order to bring them up to standard for local authority/Approved Housing Body leases.
Onate provided a facility of €760K, enabling the borrower to release equity. This helped assist the promoter to progress with both the purchase and refurbishment works on the three separate properties. Subsequently, within a nine-month period, the loan was refinanced with a longer term source of finance.
This case study highlights the significance of bridging finance in addressing funding challenges when faced by a number of projects at once. The property was recently refinanced with a longer term funding solution.
Team Tuesday: Meet our Underwriting Manager, Jenny O’Driscoll
Where did you begin your career?
“My first job was as a lounge girl in a local pub. I loved working in a customer facing role.
It was a great way to learn how to navigate various personalities which I think has really stood to me throughout my career to date”
What is the best career advice you’ve ever been given?
“Put effort into building good working relationships and if the occasion arises, do your best to help someone if/when you can.
Ireland is small and I’ve come to realise the property and finance industries are even smaller.
I come across the same people regularly so it’s always good to be able to call in a favour if you’ve helped them out with something previously!”
What tips would you give to someone starting in your profession?
“Ask as many questions as you need to.
Questions show willingness to learn and desire to do things right.
I have always been of the mindset that you’re better off checking than getting something wrong if it can be avoided”
What is your greatest professional achievement to date?
“I am very proud of my masters qualification.
DCU managed to find hours in my day I didn’t know I had and required a lot of hard work.
I believe this has set me up well for any future endeavours”
Tell us something people may not know about you
“I love cars. I spent many a weekend as a young child “helping” my dad in the garage behind our house.
I even did my transition year work experience as a mechanic.
Not a way many 15-year-old girls choose to spend their time!”
Case Study: Bridging Finance of €680,000 provided in Dublin
Financing purchase of a residential investment property
The loan has been refinanced within nine months
Late last year, Onate received an inquiry in relation to part-financing the purchase of a large detached property in County Dublin. The borrower successfully secured the property for €970,000 through an intensive private treaty bidding process with multiple interested parties.
As there was a time pressure relating to the completion of the property purchase, this did not allow the borrower time to obtain a term loan from a lender. The borrower's strategy was to use the Onate finance offering to secure the purchase of the property and then refinance the property with a longer term funding solution.
Onate provided a facility of €680,000 in order to allow the promoter to close out the purchase in a timely manner. After nine months, the loan has been refinanced to a mainstream bank lender on a longer term, with the full rental income being used to amortise the loan.
Team Tuesday: Meet our Senior Accountant, Conor Dunne
Where did you begin your career?
“My first job was a long time ago in the local fruit & veg shop.
More recently, I began my career in An Post before stepping into the world of finance and lending with another alternative lender which lead me to joining Onate”
What is the best career advice you’ve ever been given?
“I think it was Einstein who said that anybody who has never made a mistake has never tried anything new.
I’ve had lots of good career advice but one thing that I remind myself of as often as possible is that you are never finished learning.
Every day is an opportunity to learn something new, whether it be from the people you work with or the challenges you encounter.
Similarly, it is important to regularly venture outside of your comfort zone, as this is where you are most likely to learn and grow”
What tips would you give to someone starting in your profession?
“Pursuing a professional accounting qualification can be very daunting from the outset.
It will no doubt be challenging, and everybody encounters setbacks along the way. However, if you can find self-belief and the determination to overcome these setbacks and see the qualification through, you will reap the rewards at the other end.
So I would always encourage anybody considering a future in accounting and finance to go for it, as it will unlock countless opportunities and open plenty of doors throughout your career”
What is your greatest professional achievement to date?
“Prior to joining Onate, my greatest professional achievement was receiving recognition from the ACCA for placing 1st place in Ireland in one of my final exams. Knowing how much hard work (and blood, sweat and tears!) went into preparing for each exam, this is a source of great pride for me.
However, having joined Onate while it is still a relatively young business, I expect that there will be plenty of opportunities for greater professional achievements - both individually and as part of the wider team as we move forward on this journey together”
Tell us something people may not know about you
“My career could have taken a very, very different path. At nine years old, my mother took it upon herself to enrol me in an archaeology course that was on every Saturday afternoon in DCU (while I wanted to be out playing football with the rest of my friends).
Needless to say, archaeology didn’t turn out to be one of my strong points! I got my wish and was out picking daisies by the time the next football season kicked off”
Dispelling Common Misconceptions about Bridging Finance
Onate has been at the forefront of the Irish bridge lending market since its inception in early 2021. While many understand the variety of uses and benefits to this lending method, there are still some lingering misconceptions. When debunked, they reveal bridge lending to be a useful and efficient short-term finance option.
Here are the three most common misconceptions that we see at Onate:
1. Bridging finance is expensive
2. Bridge lending can only be used for the purchase of property
3. Bridging finance is no longer available
1. Bridging finance is expensive
Bridging finance is a bespoke offering that allows the borrower get from A to B, be that the purchase of a property (that will ultimately be refinanced), the funding of a debt settlement with a bank or investment fund, or the releasing of equity in a property already owned, to take advantage of a market opportunity.
What the borrower is ultimately paying for with bridging finance is speed, ease of execution and certainty. Onate has a proven track record in the market for completing loans quickly and assisting borrowers through the process in a clear and concise manner. There is nothing more expensive than a missed opportunity!
2. Bridge lending can only be used for the purchase of property
Property purchase is just one of the many uses of bridging finance.
Bridge finance can also be used for:
Releasing equity tied up in a property that the borrower already owns (either debt free or with a low level of debt attaching). Equity release can be used for numerous purposes, allow for quick access to funding and is an effective way for a property owner to unlock the value of their property without having to go through an expensive and prolonged sales process
Funding debt settlements with pillar banks or investment funds. Using bridging finance to settle legacy debt issues is extremely popular as it can be accessed quickly. Secondly, certainty of funding is paramount. In addition, the term of the bridging loan provides the borrower with a track record of loan repayments and the ability to invest in the property itself. Both are beneficial when the borrower goes to refinance with a pillar bank or other term loan providers.
3. Bridging finance is no longer available
Bridging finance has been a feature of the lending market for over 60 years. However, its popularity did wane after the financial crisis in 2008. As international banks exited the Irish market completely, others - including the pillar banks - pulled back from bridging finance as they felt it was no longer core to their business. It was seen as a specialist offering that they could not effectively offer through their ever-shrinking branch network. To this end, many borrowers don't consider bridging finance as an option.
This created an opportunity for lenders like Onate to capitalise on this gap in the market. At Onate, we support borrowers who need short-term property finance to acquire investment properties, release equity in properties they already own, or to fund that debt settlement agreement that they have spent months or even years negotiating.
Bridge lenders understand their customers, their needs and can provide solutions that work for them with an exit strategy that suits their needs.
To find out more about Onate’s lending process, call (01) 697 2588 or email hello@onate.com
Case Study: Bridging Finance of €975k provided in Dublin
In May 2022, Onate was approached by a valued introducer with an opportunity to fund a debt settlement secured on a large 4-bedroom house in Dublin.
The promoter had secured the debt settlement from the fund and needed to close out the refinance within weeks.
Given the time sensitivity of the transaction, Onate acted quickly and an approval in principle was issued on the same day.
Once the due diligence fee was paid, the Onate team acted quickly to instruct the valuation and arrange an all-party call with the promoter, introducer and both sets of solicitors. This gave everyone an understanding of what they needed to happen to close out the transaction in advance of the settlement date.
With all parties focused on the debt settlement date, Onate was able to provide a facility of €975k before the settlement date which ensured that the promoter was in a position to comply with the debt settlement agreement terms.
The promoter subsequently put the property for sale on the open market and the sale led to the loan being repaid before the end of the 12 month loan term.
Team Tuesday: Meet our Senior Underwriting Manager, Shane O’Connor
Where did you begin your career?
“My first job was bartending at my local tennis club, which I’d recommend to everyone. It’s a great way to meet different characters and develop communication skills.
Professionally, it was with Pepper Asset Services in 2015 when I finished college in Shannon, Co. Clare.”
What is the best career advice you’ve ever been given?
“Build your network and never burn bridges. This is a small industry so building your network and maintaining good relationships is vital.
When joining a new business, it’s important that you prove yourself by doing and getting stuck in – people need to see that you are genuine. This will help you build your network organically.
It has become evident to me how important the contacts I’ve built throughout my career can be and how they can come back around and help resolve a problem within my current role.”
What tips would you give to someone starting in your profession?
“Don’t be afraid to ask questions. College is great to build a foundation but learning on the job is invaluable.
Starting out in a new role is always daunting but by asking as many questions as you can, no matter how silly you may think they sound, will really help you to excel at a faster pace. It will also show your enthusiasm for the role.”
What is your greatest professional achievement to date?
“That’s an easy one! I was recently promoted to Senior Underwriting Manager in Onate. It’s always a great achievement to get promoted.
However, doing it with Onate, a company I joined less than 18 months ago, at the start of its journey, makes it all the sweeter.”
Tell us something people may not know about you
“When I was a year old, I crawled through the bannisters of a winding staircase on the third floor of a hotel and somehow escaped any injury (that I’m aware of)! I’m a cat with nine lives, with about five left!”
Onate – A ‘Remote First’ Company
When Onate launched in Ireland in early 2021, remote working was the norm for everyone.
It was always the intention at Onate to opt for a ‘remote first’ working environment, regardless of the pandemic. Our staff don’t need to be in the same office five days a week to get the job done.
All of Onate’s processes are optimised for remote working, rather than adjusting an office way of working to facilitate staff working from home. This means that everyone is incredibly efficient and aligned, even when not in the office together.
Onate CEO Dan Gandesha said:
“If you start from a remote-first culture and outlook, you can end up with a much better outcome than an office environment. It’s very easy to take a simplistic approach when it comes to office work, such as do staff come in on time, do they put in long hours, are they always in their seat. Historically, that’s how we assess productivity – it has been a tick-the-box exercise. When you have a remote team, that’s not an option. You have to treat people as grown-ups and trust them.”
As a result of the ‘remote first’ way of working, having no physical office gives Onate better options when it comes to hiring candidates. Onate’s employees are based in Dublin, Kilkenny and Limerick.
Gandesha continued:
“I employed a recruit from Limerick who was the best person for the job we advertised but if I had an office in Dublin and required everyone to be in the office five days a week, I wouldn’t have been able to hire him.’
At Onate, we meet one day a week in a shared office space which gives us opportunities to have coffees and build relationships. Our office day (every Wednesday) has now become Onate’s least productive day in the week. However, from an employee relations perspective, it is important that we meet in person regularly.
Allowing people to work from home has improved the productivity of the business and borrowers have been impressed by just how quickly we can execute deals. We regularly close loans in less than 10 days and we have closed some loans in as little as 5 days.
Working remotely gives our staff autonomy and makes Onate a far more efficient operator. Even though we’re a ‘remote first’ company, we deliver fast and flexible finance, wherever you are and wherever we are.
Case Study: Bridging Finance of €385k provided in Meath
Onate received an inquiry in Q2 of 2022 in relation to the refinancing of existing debt and providing an equity release in order to fully complete a former public house in County Meath. The property had undergone extensive works in order to renovate it into five self contained apartments of varying size from one bed to four bed apartments.
Onate issued an approval in principle and the promoter was keen to progress with our finance offering as they required the equity release in order to complete the property, including the kitchens, bathrooms and floor tiling. Due to the works being at an advanced stage, we didn't require our own engineers or quantity surveyor on site to supervise or certify these works. This was useful from the promoter’s point of view as it allowed full drawdown of the loan from day one.
Onate provided a facility of €385,000 in order to allow the promoter to refinance with another lender. The €385,000 provided the equity release required to finish out the property completely. Onate also provided a six month interest roll up period to allow the promoter time to rent the property and stabilise its income. The property was valued at €950,000.
Within a six month period, the loan has now been refinanced to another non-bank lender on a longer term agreement with the full rental income being used to amortise the loan.
Team Tuesday: Meet our Group Financial Controller, Paul Walshe
Where did you begin your career?
“I began my working life at age 16 at the local newsagent, only working Wednesday and Saturday to coincide with the Irish Lotto peak hours, a manic time of the week in the newsagent world.
My first real job was in the local credit union working as a teller, before I moved to Irish Permanent Finance (Yes, I am that old!).”
What is the best career advice you’ve ever been given?
“Dragons take on many forms – the hardest task of the day, a new responsibility, an impending deadline, or even dealing with conflict – and the trick is to just slay the dragon and move on.
Don’t overthink it - copied off google, sounds good though.
I think it’s really important to mentor some folk early in their career and they will pay you back later in your career by being a sounding board, a source of intel and even buy you a glass of wine or two.”
What tips would you give to someone starting in your profession?
“You will need a calculator, don’t go for the scientific one, just a cheap Casio one and try to hold onto it for 20 years, it wont let you down.
On a serious note, working at a Big 4 firm is the goal for a lot of finance graduates. The exposure you receive to all aspects of the industry is hard to come by and allows you to develop a wide range of hard and soft skills which make you highly coveted by the majority of other companies...
If you don’t make it there, I would also seek as much varied experience early in your career as possible and you can do the relevant academics at a later date, seek out a start-up or some companies early in their journey and they could offer you greater opportunities.”
What is your greatest professional achievement to date?
“All my achievements have been as part of a collective including hiring trainees, giving them a solid grounding and watching them flourish and then fly the nest and become very successful in their own right.
Joining Onate in its rapid growth phase has been a great challenge and building new processes each and every day makes it very interesting, coupled with new funders to keep you on your toes.”
Tell us something people may not know about you
“I regularly tour around the world after a particular music band who will remain nameless, having seen them 63 times so far, it’s my kind of religion.”
Case Study: Bridging Finance of €300k provided within 6 days
In July 2022, Onate was approached by a well-known property developer with an opportunity to bridge the purchase of an investment property in Dublin, with an additional unencumbered investment property being provided as additional collateral.
The investment property was being purchased through an online auction. The closing date for the auction property was a little over a week away and because of this, the Borrower was at risk of losing out on the property as well as their deposit. Knowing Onate’s reputation for transactional speed and certainty, they contacted us directly to discuss their funding requirement.
Onate acted quickly and indicative terms were issued to the Borrower that same day. Terms were quickly agreed with the Borrower and Onate’s experienced execution team kicked into action, immediately instructing our panel solicitor and valuer. A call with all parties was held within 24 hours of instruction with both sets of solicitors, and within 48 hours, our valuer had provided Onate with valuation reports for both properties.
With all parties focused on the closing date, Onate was in a position to provide a facility for €300k within 6 days of terms being agreed. The Borrower completed the purchase of the auction property within the specified timeline, and immediately set to work carrying out light refurbishment works on the property.
Once that property was finished and tenanted, the Borrower was in a position to refinance the Onate facility with an alternative lender over a longer term.
The Importance of Bringing Vacant Properties Back to the Market
The team at Onate recently heard architect Hugh Wallace being interviewed on national radio on the topic of how Ireland’s housing crisis can be alleviated. Hugh raised a very important topic, namely the high number of vacant residential properties across the country. He noted that although some of these are large derelict buildings in our cities, many are individual residences over shops on the main streets of our villages and towns. Bringing these residences back into housing market – either for rent or for sale – is an opportunity that is currently being missed.
With regards to our cities, Hugh noted that there are many vacant properties located in Cork, Dublin, Kilkenny, Waterford, Galway and Limerick. These are also cities that have huge demand for housing, and a shortfall in supply.
Hugh also spoke of the new Living City Initiative which offers tax incentives to those willing to restore and rehabilitate heritage buildings. Bringing vacant properties in towns and cities back into the supply has added benefits when compared to the current strategy of urban sprawl. These include reduced commute times, reduced carbon emissions (from the reduced commute time), and bringing consumers (and their wallets) back into our towns and cities. Renovating a vacant property is also much quicker than building a new property from scratch.
In Budget 2023, Ministers Donohoe and McGrath announced a vacant homes tax. The tax will target homes that are occupied for fewer than 30 days in a 12-month period. The aim of the tax is to bring more housing stock to the market by encouraging people who own vacant or derelict properties to refurbish or sell.
Census 2022 reported 166,752 vacant homes across the country. To put this in context, according to the Central Statistics Office (CSO), just under 155,000 new housing units (one-off houses, houses in development and apartments) have been completed in Ireland between 2011 and Q3 2022. These numbers paint a stark picture of the problem, but also one possible solution to the current housing crisis.
At Onate, our offering is structured to allow borrowers to release equity quickly and easily from their residential and commercial properties. This equity can then be used to refurbish vacant or derelict properties and bring them back into the housing stock.
Our team of experienced, specialist property lenders offer bespoke property bridging loans to home builders, developers, property investors and entrepreneurs. We are fast and flexible, and we assess each case on its merits. All decisions are taken in-house which means we can move quickly and with certainty.
We have an appetite to lend in all locations nationally – from cities and large towns to small villages and rural locations.
Team Tuesday: Meet our Senior Underwriting Manager, Mona Samadi
Where did you begin your career?
“I began my career in AIB in 2006, starting out as a customer service official. That’s where I learned the importance of relationship management.
I briefly got to experience banking in the good times before the crash when everything completely changed. ”
What is the best career advice you’ve ever been given?
“Don’t underestimate your capabilities. Others will regard you the same way you regard yourself.
If you don’t value yourself, others will undervalue you as well. Value yourself highly, and others will follow.”
What tips would you give to someone starting in your profession?
“Stay focused and never give up what you want to achieve in your career.
Everything is possible when you put your mind to it.
Don’t be afraid to ask questions when you don’t understand something. ”
What is your greatest professional achievement to date?
“I am extremely proud of where I am in my career. Every job I’ve had since I graduated from college has, in its own way, been a career steppingstone.
I have learned something from each role that I have been able to apply to the next.
My role in Onate has also given me a new platform to do what I have always loved to do as an underwriting manager, and I’m very excited to be part of the Onate journey. ”
Tell us something people may not know about you
“I can speak Farsi!”
Case Study: Bridging Finance of €1m provided in Leinster
Equity Release Loan
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10 day closing achieved
At the end of Q2 2022, Onate was presented with the prospect of providing an equity release for a promoter who had committed to purchasing a non lender friendly property which was core to their future plans. Separately, the promoter was in the process of completing a high end bespoke new build in a great east coast location where they had finished 90% of the works on the property.
The main issue the borrower had was timing as they needed to ensure that they had funds to complete the purchase of this other property which they were contracted to buy by an agreed closing date.
Onate issued an approval in principle within 24 hours and the borrower signed and returned this with our due diligence fee. We moved quickly in order to ensure that the valuation was completed and the legal due diligence commenced to review the title of the property being offered as security. Despite the tight deadline, we were able to ensure that the borrower's solicitors were in funds within 10 days of engagement by the borrower.
Onate provided a facility of €1M in order to allow the borrower to purchase their next property. The new build property that Onate took as security was valued at €1.45M and is currently on the market in order to clear the facility in full. We were also able to provide an element of interest roll up to assist the borrower as the property is being sold with vacant possession.
“Onate delivered for our client under a very tight timeline and they were a pleasure to deal with throughout. Closing within 10 days from initial enquiry is extremely difficult in today’s funding environment but the team went above and beyond to ensure the client could close the transaction with confidence.
Managing to run legals, valuation & due diligence in tandem was testament to not just the lender but also the third parties involved and I wouldn’t hesitate in recommending Onate to any potential borrower or broker”