Pbb Deutsche Pfandbriefbank (pbb), Aareal, and AshbyCapital have jointly underwritten a £90 mln (€104 mln) debt facility to MDM Asset Management and Hana Securities to refinance the 230,000 ft2 Gallagher Shopping Park in the UK.
CBRE’s Debt & Structured Finance team advised the Korean group on the refinancing. As part of it, AshbyCapital, the property investment management company, has completed its first debt deal, providing a three-year, £20 mln loan fixed-rate facility.
Incumbent senior lenders pbb and Aareal have also extended their existing financing for the asset, with AshbyCapital stepping in to provide a £20 mln mezzanine and capex facility; the total LTV ratio is under 70%. This is AshbyCapital’s first deal in the debt sector, with its platform focusing on mezzanine and development finance opportunities between £10m and 50m.
A statement from Hana Securities said: 'The challenges we confront in global real estate markets today are multi-faceted, and there is downward pressure on asset values. For Hana Securities, the best strategy to protect our global investments is to be pro-active by demonstrating resilience and trusting our partners to confidently navigate the challenges we face. We were pleased to see Quadrant and MDM Asset Management, in collaboration with CBRE, doing just that by successfully concluding the refinancing of Gallagher Retail Park and securing our position in this prime retail asset.'
Charles-Etienne Lawrence, investment director at AshbyCapital, said a significant opportunity had presented itself in real estate debt, which is looking increasingly attractive due to revaluations and rising interest rates.
Chris Gow, head of debt & structured Finance at CBRE, added that despite current market conditions and fluctuations in real estate yields, ther was still strong 'debt liquidity' for quality assets such as Gallagher Shopping Park.
'The robust performance of the asset and strong income generation recorded throughout the period of ownership resulted in several offers being brought forward and furthermore, we have been able to structure an attractive facility to ensure our client will benefit from future asset management potential.'
Christopher Daniel, founding partner at Quadrant, added: 'We are delighted the incumbent lenders continued to support this asset and to have partnered with Ashby has been a further expression of confidence in the asset and the sponsor’s commitment.'
'Despite the retail headwinds the park has remained relevant and continues to attract both shoppers and retailer interest. We now look forward to working with our partners to continue to enhance the park over the coming years.'