Royal Bank of Scotland (RBS) has provided Empiric Student Property with £30.63 million of development finance to fund the construction of a portfolio of UK student housing schemes.
The loan is secured against the portfolio of five forward-funded assets, which are held as a lending group through a subsidiary called Empiric (Five) Limited.
Each of the five developments is allocated a loan limit within the facility, which is to be drawn down in stages over the development period of each property. The facility will convert into an investment loan for each development once the schemes reach practical completion.
Empiric, which owns and operates high-end student accommodation across the UK, said that it will maintain a conservative level of borrowing, with a target of 35 percent and no more than 40 percent of the company’s gross asset value.
Debt brokerage firm JCRA provided strategic advice on the arranging and structuring of the deal.
“Empiric has established itself as a leading investor in both operating and development assets in the growing UK student accommodation market. We’re pleased to provide ongoing and increased support for their future development plans,” said Nick Cussen, director in RBS’s real estate finance team.
“RBS continues to support Empiric’s strategy through the provision of this development debt facility. The facility will help to maximise the group’s development potential, enabling us to recycle equity currently committed to our forward funded developments,” said Paul Hadaway, chief executive of Empiric Student Property.