McKay Securities, the only Real Estate Investment Trust specializing entirely in the South East and London office and industrial markets, announces the completion of a comprehensive refinancing of its loan facilities.
The refinancing has increased the scale of the Group’s loan portfolio from £155 mln (approx. €215 mln) to £175 mln (approx. €242.6 mln), with Aviva Commercial Finance Ltd introduced as a new lender and relationships maintained with three of the Group’s four lending banks.
It provides an extended maturity profile and secures the Group’s borrowings ahead of loan expiries due to commence in 2016.
The new loan from Aviva is a £55 mln (approx. €76 mln) facility with a fifteen year term, fixed at 4.13%. This replaces a bank facility of £47 mln (approx. €65 mln) due to expire in February 2016. Facilities with other existing lending banks have been increased by £12 mln (approx. €17 mln) to £120 mln (approx. €166mln), of which new facilities account for £85 mln (approx. €118 mln) on five year terms.
The new loans have extended the overall maturity of the Group’s facilities from a weighted average length of 1.6 years to 9.1 years on day one. The next expiry is not until December 2017; and McKay’s overall cost of debt will be reduced from 6.60% (30th September 2014) to 4.62% on day one, reducing to 3.80% when fully drawn at the prevailing rates.
Giles Salmon, Finance Director, said: “On the back of €104 mln of investment deals over the last 16 months, and as we continue to build out our €69 mln development program, we are delighted to secure this financing package. It gives a secure platform for our continued growth on what we believe to be attractive terms. We are delighted to welcome Aviva as a new lender and look forward to building our relationship with them and enhancing the relationship with our retained lending banks.”
Source: McKay Securities