Central London mixed-use REIT Shaftesbury Capital has inked an unsecured loan agreement amounting to £300 million.
The initial maturity of this agreement spans three years, with the provision to extend the tenor by two additional periods of one year each, contingent upon lender approval.
The proceeds of the facility, combined with the existing cash resources of the company, will be used to repay the remaining balance (£376 million) of the unsecured loan, which was arranged at the time of the merger and drawn in April 2023 to fund the repayment of the Shaftesbury PLC secured bonds.
The unsecured loan is due to mature in 2024. As announced in the trading update on 27 November 2023, cash balances at 30 September 2023, adjusted for recent asset sales, were approximately £200 million and the Covent Garden revolving credit facility of £300 million is undrawn.
The facility comprises term loan and revolving credit elements, which will provide the Company with the flexibility to manage the level of drawn debt, liquidity and finance costs. The facility includes a £125 million uncommitted accordion feature which may allow the Company to increase the total revolving facility commitments.
As a result of the refinancing, the weighted average maturity of the company’s drawn debt will be extended to over 5 years. The current weighted average cost of debt is unchanged at 4.2 per cent, which reduces (taking into account interest income on cash deposits and the benefit of interest rate hedging) to an effective cash cost of 3.3 per cent.
The facility has been provided by Santander UK PLC, HSBC UK Bank PLC and BNP Paribas, London Branch. The Company was advised on the Facility by Rothschild & Co and Herbert Smith Freehills.
Situl Jobanputra, Chief Financial Officer of Shaftesbury Capital, commented, “We are pleased to have completed the early refinancing of the £576 million loan through this facility and other initiatives this year, which highlight the attractiveness of our exceptional portfolio and further enhance our capital structure.”
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