Investec finances Ballymore in return to investment lending

Investec Structured Property Finance has provided Irish developer Ballymore’s first loan since it exited the Irish National Asset Management Agency in a deal which also marks Investec’s return to investment lending since 2006.

The bank has provided an £18 million facility to Ballymore which is secured by two income-producing light industrial sites in the Silvertown area of east London, close to London City Airport. It said that the loan will “enhance existing income” at the properties while Ballymore aims to secure planning consent for residential-led development at the sites.

Ballymore’s full exit from NAMA was finalised in December 2016. The firm is reported to have repaid €3.2 billion in gross debt to the Irish ‘bad bank’ since 2010. Last December, the Irish Times reported that, in a note to employees, Ballymore founder Seán Mulryan said the group had also paid back borrowings to lenders including Royal Bank of Scotland, taking total group debt repayments to around €4 billion.

Investec is aiming to diversify its loan book during 2017, prompting its first significant investment financing since the before the financial crisis. “During 2017 we will be looking to originate more investment financing, alongside growing the development loan book,” commented Mark Bladon of Investec.

A separate facility provided by Investec in April contained an investment element. The bank provided a £47.7 million senior development and investment loan to finance a 527-bed student accommodation scheme in east London.

The two-year facility was provided to Curlew Student Trust, a joint venture that was launched in 2013 by CBRE Global Investment Partners and Curlew Capital, to finance the Mannequin House scheme in Walthamstow. The facility will fund the scheme through to practical completion in July this year, as well as for a subsequent 18 month investment period.

“This facility, which straddles both the development phase and an investment period, allows us to commit to the scheme as it becomes income generating,” said Bladon.