OakNorth Bank lends £2m to Warwick Estates to assist with the property manager’s ‘buy and build’ strategy  

  • OakNorth has lent £2m to Warwick Estates – the established property management business which manages over 850 sites, encompassing 27,500 units;
  • The debt finance will assist the company in its ‘buy and build’ strategy as it looks to acquire other property management businesses and develop as a market leader in a fragmented market;
  • Warwick Estates has already concluded two acquisitions and has identified a number of further acquisition opportunities which are in discussion;
  • Property managers currently look after approx. half of the leasehold flats in England and Wales so play a very significant role in the market.

 

OakNorth– the bank for entrepreneurs, by entrepreneurs – has provided £2m of debt finance to Warwick Estates, one of the UK’s largest property management companieswhich last year gained investment from Sir Rod Aldridge, the founder of Capita. The £2m financing represents the first phase of a new relationship between OakNorth and Warwick Estates.

The finance provided by OakNorth will be used to implement a ‘buy & build’ strategy to consolidate a highly fragmented market. Warwick’s ambitions are to acquire numerous property management portfolios each year, with a particular focus on small to medium sized competitors who manage up to 10,000 units. The Group has already identified several attractive target businesses, and is seeking to fully deploy OakNorth’s financing during 2018.

Headquartered in Harlow, Essex, the Group has additional offices in London, Cardiff, Grays, Warrington, Cheltenham and Portsmouth, and employs 115 people across the UK. It engages in property management activities to leaseholders in communal buildings, acting as a managing agent appointed by the buildings’ management company. Warwick Estates aims to provide all of their clients with exceptional service delivered by their staff, supported by their custom-built technology platform. As part of this commitment, 2017 saw a major investment to launch the Warwick Academy which provides staff with industry-leading training throughout their career. Warwick also offers bespoke products for their clients through their Premier and Lite brands, allowing clients to create a bespoke service to match their requirements and budget.

Commenting on the dealCEO, Dr Craig Stevens, said: “We are delighted to have partnered with OakNorth. Throughout the process we have been impressed by their approach and engagement with the business. With such an excellent partner on board, we are excited to continue looking for new acquisitions and expanding the Warwick brand, bringing our outstanding service to thousands more customers across the UK.”

Trevor Morris, Debt Finance Director at OakNorth, commented: “Members of The Association of Residential Managing Agents (ARMA) – the main trade association for property managers – manage around half of the leasehold properties in England and Wales, evidencing the scale of the market which Warwick operate in. However, it is a highly fragmented industry which is why there is a significant opportunity for Warwick to consolidate, bringing core management and data systems under one roof, and generating economies of scale. With Sir Rod Aldridge’s backing, the business is implementing a buy and build strategy which should see it become one of the largest property managers in the UK within a matter of years.”

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