CAPITAL WATCH: Recent lending deals Dec 2015/Jan 2016

Real Estate Capital market commentary

• Despite a slowdown in the market towards the end of 2015, significant loans were closed in the UK. A club of banks provided £425 million to refinance Value Retail’s Bicester Village outlet centre in Oxfordshire. The five-year loan was provided by pbb Deutsche Pfandbriefbank, Santander, Crédit Agricole, RBS and Deutsche Hypothekenbank and refinanced a 2013 facility led by Lloyds.

• In December, LBBW and TH Real Estate provided £227.5 million to Tribeca Holdings to refinance a strip of retail properties on London’s Oxford Street. LBBW provided a £160 million senior tranche, while TH Real Estate topped the facility up with £67.5 million of junior debt. Tribeca bought 431-451 Oxford Street in 2013 for £136 million and significantly raised its value through lettings.

• AIG Asset Management provided a huge loan to Market Tech, which is majority-owned by Israeli billionaire Teddy Sagi and owns the Camden Market estate in North London. The £900 million, 10-year financing comprised a £300 million term loan and a further £100 million to be drawn down in May 2016. A further £50 million is available until December 2017, with future drawdown pools of £300 million and £150 million available.

• In January, Oxford Properties and Brockton Capital confirmed that they had closed a £230 million loan, at 60 percent loan-to-cost, to finance the redevelopment of The Post Building on London’s New Oxford Street. The finance was provided by BNP Paribas and pbb Deutsche Pfandbriefbank, as revealed last November by Real Estate Capital.

• Significant financing deals were also completed in Continental Europe. Allianz Real Estate provided French REIT Eurosic with a €163.4 million, long-term loan to finance a portfolio of nine French office buildings. The 20-year facility carries a fixed rate and an all-in cost of 2.78 percent.

• Deutsche Hypo and ING jointly provided a Patrizia Immobilien fund with €160 million to finance its purchase last October of a portfolio of 145 mainly retail properties in the Netherlands, in an off-market transaction. The German investor opted for relatively low gearing for the portfolio, which it bought for €340 million.

• In the German market, Aareal Bank provided a €129 million loan to finance Tristan Capital Partners’ purchase of the Garden Tower office building in Frankfurt. The senior portion of the loan was written at a loan-to-value ratio slightly below 70 percent and was priced at just above 160 basis points. The facility also comprised a capex element.

• Tristan also secured a Kr1.022 billion (€111.2 million) loan for an investment in the Nordic market. Helaba underwrote the loan, to finance four Norwegian retail warehouses, and Norwegian life firm Storebrand took a participation in one of its first forays into real estate finance. Also in the Nordics, SEB backed TH Real Estate with a Kr850 million (€64.4 million) loan secured by the Nova Lund shopping centre in Sweden.

Click here to see recent lending deals in the market in December and January.