Auction Purchase & Conversion
Liverpool

An investor spotted a former pub with residential conversion potential at a Liverpool auction. They won the lot at £620k on a Friday afternoon with estimated conversion costs of £330k to create 6 flats. The auction terms required a 10% deposit immediately and completion within 28 days. The investor had the deposit but no funding in place for the balance or the conversion — they'd assumed they'd arrange it if they won.

The property was a derelict pub with no current income, structural issues visible on the auction particulars, and it sat in an Article 4 area meaning planning permission would be needed for the residential conversion. The investor needed a single facility covering both the £620k purchase and £330k conversion costs. Most lenders won't touch auction purchases with this many unknowns, especially with a 28-day deadline and build costs on top.

The investor called us on Saturday morning. By Monday lunchtime, we had a DIP from a specialist lender who regularly funds auction purchases with conversion works. The investor cross-charged a rental property they owned nearby to bring the combined LTV to 61.5%. We presented the deal with comparable conversion evidence from the same street, the investor's track record of similar projects, and a clear exit strategy — convert to 6 flats and refinance onto individual BTL mortgages. The facility was structured with the purchase price drawn on day one and the conversion costs released in phased drawdowns against completed works. The lender valued the property on Tuesday, legal was instructed in parallel, and we completed with a week to spare.