Dorset lender MSP secures ‘landmark’ £350m funding facility with J.P. Morgan and Pollen Street Capital

Property finance specialist MSP Capital has agreed a landmark funding facility of £350m funding involving two investment partners, J.P. Morgan and Pollen Street Capital.

Designed to bolster the firm’s continued growth in the development and bridging finance markets, this facility will enable MSP Capital to provide flexible and diverse funding solutions to developers with ambitions to build homes.

The new lines are made up of a senior-secured facility from J.P. Morgan of £200m, coupled with an additional £150m facility from existing funder Pollen Street Capital.

This, alongside the firm’s retained funding lines, with Pollen Street Capital and Shawbrook Bank, provides MSP Capital an increased total funding capacity of £485m.

J.P. Morgan has the potential to provide an additional £350m of funding in the future, meaning MSP Capital could expand its funding capacity to £835m.

The deals are the latest of several strategic moves MSP Capital has made in the past year to ready itself for more growth.

They include appointing Leigh Bartlett as the company’s first chief executive and relaunching a five-year business strategy.

Bartlett said: “These deals mark an important milestone for us and will be the driving force behind an exciting growth journey for the company, our broker partners and our customers.

“Securing these new funding lines from such reputable funders is a testament to the strength of our business and reputation among senior funders in the market, as well as our robust customer base and loan book pipeline.

“These new funding lines will further enhance our position as a respected lender, allowing us to lend more across the country.”

The transaction was supported by Interpath, acting as sole financial adviser to MSP Capital, with Travers Smith serving as the firm’s legal counsel.

Nicky Hollamby, finance director at MSP Capital, added: “This successful outcome is the result of six months of hard work by the team. The £350 million currently made available through these new funding lines, as well as the potential for more funds in the future, is an integral piece of the jigsaw for the future growth of MSP. Thank you to our funding partners, J.P. Morgan and Pollen Street, for their support and for demonstrating such a strong understanding of our business.

“A special thanks also goes to the teams at Interpath and Travers Smith for their expertise and guidance throughout this process. The hard work of the entire team has been crucial in preparing the business for this growth, and we are proud of what we have achieved together.”

Nick Parkhouse, managing director and head of financial services transactions at Interpath, said: “I first met and worked with MSP Capital over eight years ago and have had the pleasure to advise them during many key parts of their journey. This transaction is memorable for so many reasons – one of which was the exceptional market interest towards this deal which encapsulates how far the UK bridging and development market has come. The other was working alongside the great teams at MSP Capital, J.P. Morgan and Pollen Street to create an innovative funding structure which sets the business up for exceptional growth.”

J.P. Morgan is a global financial services firm, offering a range of investment banking, asset management, private banking and treasury services.

Rob Tanna-Smith, managing director at J.P. Morgan, said: “As the UK grapples with providing houses for a growing population, further development relies on the availability of additional financing sources. This transaction supports MSP in its pursuit of growing the developmental and bridging finance markets and encouraging additional homebuilding. At J.P. Morgan, our scale, specialism and broad capabilities enable us to support initiatives like these, and providing MSP with this new funding line will underpin MSP’s existing portfolio of bridging and development loans, as well as the growth in their loan book over the next five years.”

London-based Pollen Street Capital is a fast-growing alternative investment asset manager, investing in asset-backed credit and private equity strategies.

Connor Marshall-McKie, investment director at Pollen Street Capital, said: “We are delighted to extend our partnership with MSP Capital. The team has a fantastic track record, with over 40 years’ experience in property finance and deep knowledge of their local markets, representing a great fit for our asset backed credit strategy.

“Pollen Street’s deep experience in supporting bridging and development lenders has enabled us to create meaningful impact across the UK and European development landscape. Through this enhanced collaboration with MSP Capital, we’re proud to expand our commitment to financing affordable housing developments.”