CBILS helps South West Hotel Group with Asset Finance

Coronavirus Business Interruption Loan Scheme (CBILS)

The story

Aldermore launched the Asset Finance variant of the Coronavirus Business Interruption Loan Scheme (CBILS) on 1 April 2020 having worked closely with the British Business Bank (BBB) to mobilise the product.

Since then, Aldermore have been working closely to accredit its broker partners under its version of the scheme to enable them to offer the CBILS product to their customers.

One of these brokers was Peter McCullough at First County Finance, who introduced his customer, an award winning South West of England hotel group established in 2011 to his Aldermore Relationship Manager, Arran Wells.

The group convert listed buildings into hotels and work with local food distributors to offer a quality dining experience that is popular with both locals and tourists.

Aldermore were first introduced to the customer back in 2017 and since then, have supported them with a number finance agreements to enable them to acquire catering equipment and unique furniture for their hotels.

The group currently has four hotels in their chain and prior to the Coronavirus outbreak, had been close to opening a fifth. Due to the lockdown measures, their four operating hotels were temporarily shut and the plans for the fifth had to be put on hold.

In response to this, the customer put in place a number of safeguards to help it trade out of the crisis. This included immediately furloughing all staff with the exception of a skeleton head office team meaning that the Government salary support scheme, together with other initiatives such as the business rates holiday, could minimise the costs of running the company in hibernation.

The group was confident in their ability to bounce back once the lockdown measures had been lifted and intended to follow through with opening the fifth hotel. This meant they were looking to finance additional unique furniture to support these plans.

The deal

Peter and his team at First Country Finance, worked with the customer to write up a proposal to Aldermore for the finance of £96,800 on a Hire Purchase agreement that would include an upfront deposit to help reduce the monthly repayments over the five year period.

Aldermore first reviewed the proposal under its standard credit policy, however due to the impact COVID-19 had on the business, re-reviewed the previous decision under the CBILS terms and were able to offer a conditional acceptance with this product.

With the customer’s permission, Arran was able to complete the standard agreement information as well as generate the additional CBILS paperwork through the British Business Bank’s CBILS portal and work with Peter to obtain the customer’s signature. On receipt of the completed paperwork Aldermore were able to release the funds to the customer’s chosen supplier within a couple of weeks of receipt of the initial proposal.

This deal means that the hotel group is in a better position to open its new location when lockdown measures are lifted, and with the additional of the Business Interruption Payment, it doesn’t have to pay interest on the agreement for the first 12 months.

Patrick Jelly – Commercial Director, Aldermore Asset Finance

“We are delighted to support a customer such as this one with a number of asset finance arrangements and to be able to continue this support in a time of difficultly is a great feeling. Their pragmatic approach to putting in place measures that will help them trade out of this crisis is great to see and along with their strong business plan, were key drivers in Aldermore offering the CBILS product and we are keen to support other business like this one in these uncertain times.”

Peter McCullough – First County Finance

‘We have been acting for this Hotel Group for almost 10 years and have been involved in the opening of the new hotels as they come on stream.
It’s a most successful formula and having enjoyed staying many times it was a pleasure to be able to assist during a very difficult time for this industry.’ 

Find out more about our Coronavirus Business Interruption Loan Scheme and how to apply for one via our broker partners, here.

T&Cs will apply, subject to status and affordability. Any asset used as security may be at risk if you do not repay any debt secured on it.