The Hercules Unit Trust has signed a new £350m five-year facility with Lloyds TSB Bank, Metropolitan Life Insurance Company and The Royal Bank of Scotland.
The retail park fund is managed by Schroder Property and advised by British Land.
The facility comprises a £250m term loan, split equally between MetLife and RBS, which will be used to fully repay the existing credit facility three months before it expires in October 2012.
The interest rate on the term loan has been swapped to a fixed rate, meaning the all-in rate, including margin and arrangement fees, is below the fixed interest rate under the existing financing.
A further £100m revolving loan has been provided by Lloyds and “will provide flexibility for Hercules for acquisitions, capital projects, disposals and general business purposes”.
When combined with the £350m financing signed in September 2011 and the £150m financing signed by The Gibraltar Limited Partnership in March 2012, Hercules and its joint venture partners have now raised £850m of loan facilities within the past nine months.
The weighted average interest rate of Hercules’ share of gross debt has now reduced from 6% a year in September 2011 to 3.8% a year, assuming that the revolving elements of the new facilities are fully drawn.
British Land has a 41% interest in Hercules Unit Trust. The Gibraltar Limited Partnership is 50% owned by the Hercules fund.
Lloyds, MetLife and RBS acted as arrangers of the new facility and RBS acted as co-ordinator. Lloyds will act as facility agent and security agent.
bridget.oconnell@estatesgazette.com
