Custodian REIT will have £25m for new property acquisitions and £20m to repay existing term loans ahead of their expiry after agreeing a new £45m debt facility.
The funding has been agreed with a partnership of Lloyds Bank Commercial Banking’s Real Estate team and Scottish Widows over 12 years at an all-in fixed rate of 3%.
It follows Custodian, Lloyds Bank and Scottish Widows agreeing a £20m 10-year facility in July 2015 at a 3.9%pa fixed rate cost.
Scottish Widows is owned by Lloyds and is using its funds to undertake a fixed rate lending programme.
Custodian has more than £300m of UK commercial assets with 112 properties.
• January 2016: Custodian REIT buys mixed portfolio
• December 2015: Custodian buys leisure park
• November 2015: Custodian aims for £75m regional boost
Richard Shepherd-Cross, managing director of Custodian REIT, said: “The terms of this agreement support our investment strategy, which is based on long-term asset retention and efficient capital management to supply investors with an attractive level of income.
“As we have found with our original agreement with Lloyds Bank and Scottish Widows, we also have flexibility through the option to substitute properties.”
Richard Round, relationship director at Lloyds Bank Commercial Real Estate, added: “This deal showcases the versatility of the long-term funding solution we can provide in partnership with Scottish Widows.
“We can support not only large, single assets but also more complex and diverse portfolios such as Custodian REIT.
“We are backing a talented and ambitious management team as much as we are the strength and balance of their asset mix.”
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