‘Creation’ of own funds (Equity Release) based on a portfolio of real estate assets
Real estate entrepreneurs often hold a substantial portfolio of illiquid assets
Liquarto assisted an entrepreneur in unlocking capital from his existing real estate portfolio, with the aim of achieving further growth - without using additional own funds.
The situation
The client is active as a real estate investor via various companies.
The portfolio includes:
- real estate intended for long-term holding and rental,
- projects with the purpose of development and sale.
The entrepreneur wished to further expand his real estate activities by combining two specific opportunities:
- a property acquisition via an asset deal,
- a property acquisition via a share deal.
The ambition was clear: growth, but without an additional equity contribution.
The challenge
Although the existing portfolio represented a significant value, a large portion of capital was tied up in assets which were already leveraged.
The question was how to:
- free up additional liquidity,
- optimize existing financing,
- realize new investments without an additional own contribution.
Liquarto’s approach
Liquarto structured an ‘equity release’ based on a portion of the existing real estate portfolio.
1. Refinancing of the existing portfolio
A portion of the real estate assets was refinanced through bank financing for a total amount of 6.1 million euros.
The proceeds were used to:
- fully repay an existing loan of 1.7 million euros,
- finance the acquisition of the new assets with the additionally generated liquidity.
Through this optimization, dormant capital was activated and converted into growth capital.
2. Realization of the new investments
Thanks to the released funds, the entrepreneur was able to:
- realize the acquisition via an asset deal,
- execute the acquisition via a share deal, using the released liquidity as equity.
As a result, the size of the real estate portfolio substantially expanded.
3. Future outlook: additional leverage
In a next phase, the newly acquired properties will be refinanced again through bank financing. The expected proceeds from this refinancing will generate additional liquidity, which can be used to acquire a new portfolio of real estate assets.
In this way, a structured growth cycle is established, where value creation is systematically reused for further expansion.
The outcome
The implemented structure led to:
✔ The release of EUR 6.1 million from the existing real estate portfolio
✔ A repayment and optimization of outstanding debts
✔ The completion of two strategic acquisitions
✔ A substantial expansion of the real estate portfolio
✔ No additional equity contribution
The added value of Liquarto
This case illustrates how a well-thought-out financing strategy enables real estate entrepreneurs to accelerate the growth of their asset portfolio.
Liquarto combines:
- expertise in real estate financing,
- strategic insight into equity release structures,
- and a strong negotiating position with financial institutions.
Are you considering expanding your real estate portfolio or do you wish to optimize your existing financing structure? We would be happy to reflect on the subject with you.
