Deutsche Pfandbriefbank completes second financing for TIAA Henderson’s European outlet mall fund

TIAA Henderson Real Estate has refinanced an Austrian shopping centre in its €1.5bn European Outlet Mall Fund and plans to refinance three more of the malls by the end of the year.

Deutsche Pfandbriefbank, one of the two previous funders,  issued a new €54.7m loan to refinance the fund’s centre in Parndorf, Austria.

The five-year loan is part of an asset-by-asset refinancing programme for TH Real Estate’s €1.5bn pan-European fund, which was extended by 10 years in April and owns eight outlet malls across continental Europe, plus indirect holdings in three assets in the manager’s UK outlet mall fund.

The deal reflects a loan-to-value of less than 50% and will allow the fund to undertake asset management work at the 42,120 sq m retail hub and a 5,500 sq m extension, which is due to complete in 2016. Parndorf is around half an hour from both Vienna and Bratislava and includes units let to Armani, Gucci, Polo Ralph Lauren and Michael Kors.

It is the second deal agreed between the two parties in the past two months with a €67m loan agreed in June to refinance Designer Outlet Berlin. It is understood that the latest loan is more competitively priced than the 160 basis points above Euribor agreed for the Berlin deal.

The new financing replaces a €39.2m loan that was due to mature in December that was split evenly between Deutsche Pfandbriefbank and WestImmo.

TH Real Estate expects to refinance three further assets before the end of the year – one in Italy, one in Germany and one in the Netherlands.

Colin Throssell, TH Real Estate’s head of treasury, told Real Estate Capital: “Pre-2007 we could have cross-collateralised but doing that across jurisdictions is difficult now so we try and avoid it. We are contemplating a fund wide bond issuance at some stage but at this stage in the financial market, with exposure in Italy in particular, we have put that off for the time being. We are taking an asset by asset approach and given where margins and rates are at the moment that’s been very positive.”

Charles Balch, head of real estate finance international, UK & central and Eastern Europe at pbb Deutsche Pfandbriefbank, said: “These two transactions are a prime example of PBB’s ability to provide local financing for its international clients across its pan-European network.”