TH Real Estate is providing a £52m loan to Grainmarket Properties for the refinancing of a portfolio of 10 office and retail buildings in London and the South East.
The six-year facility has a loan-to-value of 75% and comprises a floating rate senior loan and a fixed rate junior component. The new facility replaces a loan from HSBC.
TH Real Estate intends to syndicate the senior loan and retain the junior facility in its UK Enhanced Debt Fund that launched in December. The fund is targeting £500m of equity and has completed its first close with £138m. It targets a 6-7% return investing in whole loans and selective mezzanine up to 75% LTV.
Shawn Kaufman, director of debt strategies at TH Real Estate, said: “The Grainmarket transaction is representative of how our syndication strategy enables us to deliver an attractively priced whole loan financing solution, up to 75% LTV, to our borrowers, while, by retaining the junior portion of the capital structure, delivering an enhanced return to our fund investors.”
Grainmarket, a London-based investor and asset manager, owns 21 commercial, residential and retail assets in London and the South East.
The 10-building portfolio refinanced by TH Real Estate is over 90% let with almost three-quarters of it by value located in central London.