Lloyds arranges £409m Lazari refinancing

Lloyds Bank Commercial Real Estate has arranged a £409 million financing package for family-owned investment firm Lazari Investments, combining medium and long-dated funding alongside three other lenders.

The debt, provided across two loans, refinances six central London properties within Lazari’s portfolio.

The first loan was provided through Lloyds’ CRE lending unit’s partnership with Lloyds Banking Group’s insurance firm, Scottish Widows. At £118 million, the loan is the largest to be written to date through the initiative between the two group companies. The facility has a 10-year term and is secured by two buildings.

The second tranche of the deal was arranged by Lloyds as a club loan to refinance four properties. The £291 million, five-year loan was provided alongside Royal Bank of Scotland and MetLife. The three banks each participated in a third of the funding. Lloyds acted as lead arranger in the deal.

The Scottish Widows agreement covers two fully-occupied central London assets. The first, 72-86 Baker Street is an 83,900 square feet six-storey building. Public relations group Publicis holds close to 72,000 square feet on a 15-year lease. The second asset is Maple House on Tottenham Court Road, a mixed-use building covering over 170,000 square feet with Sainsbury’s and PC World among the retail tenants.

Four properties, including Lazari’s own headquarters at Greater London House, and Turner House on Marlborough Street in Soho have been refinanced by the three-lender club. Greater London House is also home to online retailer ASOS, which recently took on an additional 40,000 square feet of new space, which will be delivered as part of a £40 million refurbishment.

The remaining two assets in the club deal are Ferguson House on Marylebone Road and the recently -refurbished One Welbeck Street, close to Oxford Street, which Lazari acquired in 2016 for £103 million.

Andrie Lazari, director at Lazari Investments, said the restructuring of the firm’s debt facilities followed a review of its long-term strategy and the addition of new assets to its portfolio, including One Welbeck Street.

“This involved us negotiating a bespoke funding arrangement that would provide a combination of medium and long-term funding, each with its respective merits, mirroring the portfolio of properties involved. Given we are a family managed and owned business, our relationships with our lenders remain key and the understanding and relationship established with Lloyds Bank facilitated and simplified this complex transaction,” Lazari said.

“The ability to source this through a single relationship with our long-term partners removed significant complexity both from the process and the on-going management of our funding needs,” he added.

Lloyds has been a lender to Lazari since 2009.

“These two agreements showcase the broad scope and flexibility of support we can provide our clients, through our partnership with Scottish Widows and the strength of our arrangement capabilities,” commented Mary O’Reilly, director at Lloyds Bank Commercial Real Estate.

“We can take a relatively complex mix of asset types and lease profiles and then structure bespoke solutions that draw on the breadth of our product offering. In this case, we have worked with our long-standing client Lazari Investments to develop a funding package that best serves each asset and the management team’s long-term aspirations,” O’Reilly added.