DUE DILIGENCE

Before each loan is listed, Relendex carries out detailed checks and assessments.
RISK RATING
We evaluate the borrower, loan and security, and then assign a risk rating as a guide for lenders.

See below the elements that comprise the Risk Rating matrix.
OUR EXTENSIVE CHECKS AND INVESTIGATIONS
Our due diligence process is extensive and carried out by our Lending Team. The process and methodology was designed by the former head of banking at the Rothschild Banking Group. Our Senior Loan Underwriter was formerly a senior property lending officer with Rothschild Banking Group. For each loan the Lending Team report on:
  • Loan to Value
  • Interest Cover
  • Occupancy and Break Even Analysis
  • Lease Profiles including reviews, breaks and expiries
  • Weighted average unexpired Lease Periods
  • Tenant Quality (Covenant)
  • Tenant Diversity
  • The Property and its Market
  • Business Competence of Borrowers to manage the property or development
Our Lending Team then produce a Risk Rating Guide derived from key criteria of which the two most important are Loan to Value (LTV) and Interest Cover Ratio.

We then “stress test” the projected cash flows from the property using different assumptions about void periods and re-letting terms. This risk assessment is then used to place each loan into one of four indicative risk bands – A+ to C – as a guide to lenders to assess risk and return profiles.

The provision of a risk band classification is intended to be indicative only and is not an absolute measure of risk.

The report from our Lending Team together with a Professional Valuation and a detailed Loan Summary are available for viewing by registered lenders in the Virtual Data Room
SOLICITORS AND VALUERS
Solicitors and Valuers from the Relendex panel, selected from leading regional and national firms, are appointed to act on behalf of the group of lenders (who were successful at auction). The professional fees are paid by the borrower.

The solicitors will carry out full due diligence and provide standard documentation for signature based on key clauses from Loan Market Association (LMA) Loan and Security Documentation. The Valuation Report and Certificates of Title are addressed to the lender group. These reports and all other relevant documents are available for inspection at any time in our Virtual Data Room.
THE PROFESSIONAL VALUATION
The Professional Valuation is a detailed document and usually contains the following sections:
  • Executive Summary including the Open Market Value and Vacant Possession Value
  • Valuation Report
  • The Property
  • Property details
  • Legal considerations
  • Occupational market commentary
  • Investment market commentary
  • Sale market commentary
  • Valuation considerations
  • Opunion of value
  • Market Reports
  • Letter of Instruction
CERTIFICATE OF LEGAL TITLE
The appointed solicitors will carry out full legal due diligence and provide a Certificate of Title on the asset security.
DUE DILIGENCE DOCUMENTS ARE ADDRESSED DIRECTLY TO LENDERS
The Professional Valuation and Certificate of Title are addressed directly to the lender group.
VIRTUAL DATA ROOM
Professional Valuations, Title Reports, Tenancy Schedules, development appraisals and other key documents are available for viewing to registered users in our Virtual Data Room. This affords lenders unprecedented levels of transparency, empowering them to make informed decisions based on comprehensive information and their own investment criteria.
RISK RATING MATRIX
Our property lending team has created a Risk Rating Matrix-based on four major categories of risk as set out in the table below.

Finance Occupancy & Break Even Analysis The Property & Market Business Competence of Owners
Loan to Value Lease Profile Market Conditions & Letting potential Strategy & Management
Interest Cover Ratio Tenant Quality Location & Quality
Tenant Diversity Sale Potential

Important Notice

 

Relendex Limited is regulated in the United Kingdom by the Financial Conduct Authority and entered on the Financial Services Register - FRN 723117.

 

Lenders participating in these arrangements should be clearly aware that any sum lent through the Exchange is a loan and not a deposit and its repayment is not guaranteed. It is in the nature of an investment opportunity. Any investor should consider an appropriate spread of risk. Non-institutional investors should seek professional advice before lending through the Relendex Exchange.
View Notice in full

 

Relendex Limited is registered in England, Company Number 07486328 Registered Office: Ground Floor, 45 Pall Mall, St James’s London, SW1Y 5JG

 

Relendex Limited is registered under the Data Protection Act, Registration Number PZ2708231

 

 


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