Industrial & Warehouse Bridging Loans UK | Warehouse Finance

Industrial & Warehouse Bridging Loans UK

Industrial & Warehouse Bridging Loans UK

The industrial and warehouse sector has been one of the strongest-performing segments of the UK commercial property market, driven by the growth of e-commerce, last-mile logistics, and the reshoring of manufacturing and distribution operations. Demand for warehouse space consistently outstrips supply in key logistics corridors, creating acquisition opportunities that require speed and capital certainty. Industrial and warehouse bridging loans provide the short-term finance to acquire, develop, or refinance industrial assets before arranging longer-term commercial mortgages or completing sales.

Platinum Global Bridging Finance arranges industrial and warehouse bridging loans from our office at 64 Knightsbridge, London. We access specialist commercial and industrial lenders across our panel of 100+ lenders, structuring facilities from £500,000 to £25 million. Indicative terms are delivered within 24 hours.

What Are Industrial Bridging Loans?

Industrial bridging loans are short-term, asset-secured facilities used to acquire, refurbish, develop, or refinance industrial and warehouse properties. The loan is secured against the industrial asset — which may include warehouses, distribution centres, light industrial units, storage facilities, trade counter premises, and workshop buildings — and is repaid through a defined exit strategy, typically a refinance onto a commercial investment mortgage or a sale.

Industrial property valuations are driven by rental income, lease terms, tenant covenant strength, specification (eaves height, loading capacity, yard space, power supply), and location relative to transport infrastructure — particularly proximity to motorway junctions, ports, and distribution hubs. Lenders assess these factors alongside the standard bridging loan criteria of property value, LTV, and exit strategy.

Industrial Bridging Lending Criteria

• Loan sizes from £500,000 to £25 million
• LTV up to 70% on let industrial property, up to 60% on vacant units
• Interest rates from 0.65% per month
• Terms from 3 to 24 months
• Interest can be rolled up — no monthly payments required
• Available to investors, owner-occupiers, developers, limited companies, and SPVs
• Multi-let estates and single units accepted
• Vacant units accepted at lower LTV
• No broker fee on facilities of £500,000 or above

When Industrial Bridging Loans Are Used

Acquiring Multi-Let Industrial Estates

Industrial estates with multiple units let to a range of tenants offer diversified income streams and strong yields. A bridge provides the speed to complete competitive acquisitions — particularly estates sold by receivers, funds, or institutional owners with tight completion deadlines.

Purchasing Vacant or Part-Vacant Units

Vacant industrial units are unmortgageable by most long-term commercial lenders because they generate no income. A bridge funds the acquisition of vacant space, giving the buyer time to let the units and establish an income stream that supports a commercial mortgage refinance. This is a common value-add strategy — acquiring vacant units at a discount to their let value, carrying out light refurbishment, and re-letting at market rents to crystallise the value uplift.

Owner-Occupier Acquisitions

A business acquiring its own warehouse or industrial premises for operational use may need to complete faster than a commercial mortgage allows — particularly if the vendor has other interested buyers or the business needs to relocate urgently due to a lease expiry or expansion requirement. A bridge provides the acquisition capital, with the exit being an owner-occupier commercial mortgage.

Development and Conversion

Speculative industrial development — building new warehouse units for sale or let — and the conversion of older industrial stock into modern logistics specification are both active segments of the market. A bridge funds the site acquisition, with the exit being a transition to development finance or a sale of the completed units. The demand for modern, high-specification logistics space means that well-located new-build industrial units are often pre-let or sold before completion.

Auction Purchases

Industrial units are regularly sold at auction, often by receivers, local authorities, or institutional investors divesting secondary industrial stock. The 28-day completion deadline requires bridging finance for most buyers. Industrial auction lots can offer exceptional value — particularly units with short unexpired leases or in need of refurbishment that institutional investors are not willing to hold.

Portfolio Industrial Acquisitions

Investors building industrial portfolios may acquire multiple units or estates simultaneously. We structure large bridging facilities for portfolio industrial acquisitions, with cross-charged security across multiple assets to optimise LTV and reduce costs.

Worked Example: Multi-Let Industrial Estate

An investor acquires a 6-unit industrial estate in West London for £3.5 million. Five units are let at a combined annual rent of £240,000. One unit is vacant with an estimated rental value of £55,000 per annum. Current valuation based on existing income: £3.5 million. Projected valuation once fully let: £4.2 million.

Bridging facility: £2.45 million (70% LTV). Interest rate: 0.70% per month, rolled up. Term: 12 months. The vacant unit is let at month 4 at £52,000 per annum. A commercial investment mortgage is arranged at month 8 at 65% of the fully-let valuation of £4.2 million = £2.73 million. Total bridge cost over 8 months: approximately £137,200 in interest plus £36,750 arrangement fee and £8,000 legal fees = £181,950. The investor has acquired a fully-let industrial estate with approximately £1.75 million of equity and a stabilised income stream of £292,000 per annum — a yield of 6.95% on the fully-let valuation.

Key Considerations for Industrial Bridging

Environmental risk is a significant factor in industrial property lending. Lenders may require Phase 1 or Phase 2 environmental assessments for properties with a history of industrial use, particularly where contamination from previous occupiers (fuel storage, chemical processing, manufacturing waste) is possible. This can add 2-4 weeks to the bridging timeline and £2,000-£5,000 to the project costs. Asbestos surveys may also be required for older industrial buildings constructed before the year 2000.

Planning use class is important — industrial properties fall under Class B2 (general industrial) or Class B8 (storage and distribution), and some older premises have Sui Generis uses that limit the range of acceptable occupiers. The planning class affects both the property’s value and the range of tenants who can occupy the space without requiring a change of use.

EPC ratings are becoming increasingly relevant for industrial property. Minimum Energy Efficiency Standards (MEES) require a minimum EPC of E for new commercial leases, with anticipated tightening to EPC B by 2030. Older industrial units with poor insulation and inefficient heating may require upgrades to achieve compliance — a factor that affects both the letting potential and the long-term value of the asset.

Costs of Industrial Bridging

Monthly interest rates for industrial bridging typically range from 0.65% to 0.85% per month. Arrangement fees are typically 1.5-2% of the loan. Valuation fees: £1,000-£3,000 for standard industrial, higher for large estates or contaminated sites requiring specialist assessment. Legal fees: £3,000-£8,000 depending on the number of tenancies and complexity of the title. Environmental assessments (if required): £2,000-£5,000 for Phase 1, £5,000-£15,000 for Phase 2.

Frequently Asked Questions

Can I get a bridging loan on a vacant warehouse?

Yes, at a lower LTV than let property (typically up to 60%). The lender values the property on its vacant possession value and assesses the letting prospects and timeline as part of the exit strategy.

What yields do industrial properties achieve?

UK industrial yields vary significantly by location and specification. Prime logistics in the South East (the ‘Golden Triangle’ between the M1, M6, and M42) commands yields of 4-5%. Secondary industrial in regional locations achieves 6-9%. Higher yields typically reflect higher perceived risk, less liquid markets, and shorter unexpired lease terms.

Can I use industrial bridging for a development site?

Yes. A bridge funds the site acquisition, with the exit being a transition to development finance for the construction of new industrial units. Land purchase bridging terms apply if the site is undeveloped.

Are environmental assessments always required?

Not always, but most lenders require at least a desktop environmental screening for industrial properties. If the screening identifies potential contamination risks, a Phase 1 assessment (and potentially Phase 2) will be required. This is particularly common for former petrol stations, chemical works, manufacturing sites, and scrapyards.

Does Platinum Global charge a fee?

No broker fee on facilities of £500,000 or above.

Related Bridging Loans

• Bridging Loans — our main UK bridging loans page
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• Limited Company Bridging Loans
• VAT Bridging Loans
• Commercial Bridging Loans
• London Bridging Loans