Intu renegotiates €225m Spanish shopping-centre loan

The retail property giant has agreed with a consortium of lenders led by Santander a reduction of margin and an extension of maturity for the debt facility.

UK-based shopping centre investor and developer Intu Properties has amended and extended a €225 million loan secured on the Puerto Venecia shopping centre in Zaragoza, Spain.

Intu has not disclosed the banks involved in the deal but its chief financial officer, Matthew Roberts, told Real Estate Capital the consortium was led by Santander.

Following negotiations with lenders, the margin on the loan has been reduced by 120 basis points compared with the existing facility, while the maturity date has been extended from 2019 to 2025. The loan will be hedged for its full value and tenor.

Intu jointly owns the 120,000 square-meter shopping centre with Canada Pension Plan Investment Board. In 2017, the value of Puerto Venecia increased by 4 percent to £462 million (€530 million), with growth in rental values being the main driver, according to Intu’s 2017 financial report.

“We have worked closely with our relationship banks on the margin reduction and extension of this loan and we are pleased to have been able to secure these revised terms,” Roberts said.

“This is a further example of the refinancing work we have been doing over the last few years at Intu to reduce our weighted average cost of debt and increase the debt maturity profile.”

Last December, peer Hammerson made a £3.4 billion all-share offer for Intu in a deal that would create the UK’s largest property group and the second largest retail owner in Europe after Unibail-Rodamco. Hammerson opted in March for a £1.5 billion unsecured revolving credit facility to support the purchase.

On Thursday last week, however, Hammerson put its takeover of Intu on hold, ahead of an 16 April “put up or shut up” deadline for French shopping centre firm Klépierre to acquire Hammerson.

Klépierre made a £5 billion bid for the firm on 19 March. Hammerson rejected the offer, noting it was “entirely opportunistic” and “substantially” undervalued its portfolio.