Acquisition value

£14 million

LTV sought

60%

WAULT to expiry

9.5 years

Finance was required to purchase a retail park in regional UK.

The retail warehouse scheme was approximately 80,000 sq ft with 9 tenants.

The deal

Assets

  • Secondary retail asset
  • Regional UK
  • 9 retail units

Security

  • First legal charge

 


Income

  • From rental of all properties

Requirements

  • £8 million + acquisition finance

Challenges

  • Structured offshore
  • Middle Eastern family
  • Low WAULT to break

Facility Secured

  • 5 year term
  • 60% LTV
  • Interest only or soft amortisation

Summary

A modern, newly developed retail warehouse scheme which extended to approximately 80,000 sq ft at ground floor level was available for full first legal charge. Strong retail tenants were in place, with a WAULT to expiry of 9.5 years, but only circa 5 years to WAULT break.

The client had offers from two existing bank relationships but sought a whole of market comparison. They were specifically considering interest only repayment vs. soft amortisation and how each option would impact the cash-on-cash yield and IRR.

Funding options sourced increased cash-on-cash yield from 8.7% to 9.4% and IRR from 6.2% to 7.3%

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Colliers International Structured Finance
Second Floor, Weighbridge House, Liberation Place, St.Helier, JE2 3NA, Jersey.

+44 1534 767 600
structuredfinance@colliers.com

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