Aviva puts £145m into Tower 42 deal

The Kirsh Group completed the £283m acquisition of City land-mark Tower 42 last week with £145m of 20-year debt from Aviva Commercial Finance.

The group’s chairman, Natie Kirsh, said: “Aviva has provided about 50% of the money on a 20-year facility, which supports our long-term investment philosophy as we grow our international property portfolio.”

Several banks were interested in financing the acquisition, including BNP Paribas with Deutsche Pfandbriefbank.

However, Kevin Sale, commercial finance director at Aviva, explained: “The Kirsh Group wanted long-term money and to finance with one lender if possible. They also wanted certainty of delivery and execution.” The deal was completed in a relatively short time after Kirsh Group bid in January.

The acquisition covers 2.2 acres. The Tower 42 estate includes the 320,000 sq ft tower, which is 95% let, and six individual buildings totalling nearly 900,000 sq ft, including Gibson Hall on Bishopsgate. It was sold by BlackRock, LaSalle Investment Management and Hermes.

Aviva is one of the few lenders able to finance £100m-plus loans. At the end of 2011 the group signed off two deals totalling more than £300m: £184m for University Partnership Programme’s 125-year contract to manage all of Reading University’s student accommodation, and £120m for Shaftesbury’s and the Mercer’s Company’s St Martin’s Courtyard development in Covent Garden.