Hotels, shopping centres and a Nordic portfolio are among €4 bn of refinancings this week, the majority of the capital from non-bank lenders.
Blackstone, advised by Catella Debt Advisory, was able to secure lower-cost finance for its Danish portfolio, Kereby, which owns 154 properties in Copenhagen. The DKK6.8bn (€912 mln) financing package replaces a bank loan with a combination of competitively-priced mortgage bonds invested in by two unnamed Danish mortgage institutions, and subordinated debt from Macquarie Capital and Copenhagen-based Viga Real Estate Management.
Private equity firm Ares Management’s European debt fund is likely near fully invested after it advanced €440 mln to Queensgate to refinance the investor’s Generator hostels across Europe. Ares’ tranche was one of two for the entire, global Generator portfolio, with an additional $330 mln coming from Varde Partners and Waterfall Asset Management for the US properties.
Klepierre, the French shopping centre REIT, received an injection of lower cost debt from its 22.4% shareholder and US retail giant Simon Property Group. The support follows other examples of capital injections from shareholders in the companies they are invested in, for example, Brookfield and QIA’s £400 mln of debt and equity provided last month for Canary Wharf.
Simon Property issued a €750 mln bond which can be acquired in exchange for Klepierre shares and which the US group has fully guaranteed. Simon will be paid 3.5% and other investors will get circa 4.5%. It will be used to pay down recovering Klepierre’s existing debt.
Blackstone is also close to replacing bank debt supporting its Spanish residential for rent company Testa. In this instance, the senior slice of the €1.5 bn fresh loan will be advanced by its existing banking syndicate.
Several more borrowers also secured debt packages for large residential developments – from alternative lenders PGIM Real Estate, Lasalle Investment Management and Cheyne Capital.
Most deals signed off by vendors this week are smaller ones, except for Vonovia which did repeat business with Apollo (selling a 30% stake in 31,000 homes for €1 bn) and CBRE IM (1,200 flats for €357 mln.) The German residential company has now surpassed its sales target instigated to cut gearing.
There are four new assets for sale and no new funds raising capital.