Bank of Ireland has won the mandate to finance Hines’ and HSBC Alternative Investments’ €253m acquisition of a majority stake in Dublin’s Liffe Valley. Several non-bank lenders, thought to include Allianz and M&G, also quoted terms to finance the 500,000 sq ft regional mall, as did at least two investment banks, including Bank of America Merrill Lynch and Deutsche Bank.
The Irish bank provided a five-year, £140m senior loan at a 55% loan-to-value level. The margin has not been disclosed but is believed to be in the low to mid 300 basis points region – higher than for good-quality UK malls, reflecting the fact that lending liquidity for Irish property is still weaker than in larger markets such as the UK, Germany, France and Poland.
However, Ian Brown, MD, finance, at Hines UK and Ireland, which arranged the debt, said: “We had a range of quotes from various lenders.” He added: “At the time when we were talking to the market, however, I didn’t get the impression that German banks are there to lend in Ireland yet.”
Brown said one reason for choosing Bank of Ireland Corporate Banking was that the Irish bank was familiar with the local qualifying investor fund structure used for the purchase. Hines, which bought the asset with its own balance sheet, will be the asset manager. HSBC Alternative Investments is part of the bank’s wealth management division. The pair bought Aviva Investors’ 72.8% stake; the other 27.2% is owned by Grosvenor, which will remain a co-owner.