Eurohypo is arranging £710m of debt for Liberty International with a bond issue secured on its Braehead Shopping Centre in Renfrew, Glasgow, and the Harlequin Centre, Watford.
The European real estate bank is setting up two 10-year loans for the UK’s third largest quoted property company a £406.5m loan secured on the Braehead shopping centre and retail park and a £303.5m loan secured on the Harlequin Centre.
The loans will be financed through the issue of commercial mortgage-backed securities by Eurohypo’s Opera Finance conduit. The senior £480m tranche of bonds is expected
to receive a AAA grading from the major rating agencies.
The cash will be used for refinancing the Harlequin Centre, which has an existing more expensive syndicated loan, and for general corporate purposes.
This is the third bond issue used to fund loans secured on assets of Liberty International and arranged through Eurohypo’s Opera Finance conduit. The first, a £550m loan funded by Opera Finance (Lakeside), closed in August 2004 and was secured on the Lakeside shopping centre in Thurrock, Essex.
The second, a £600m loan funded by Opera Finance (MetroCentre), closed in February 2005 and was secured on the MetroCentre, Gateshead.
Liberty finance director Aidan Smith said: “This transaction follows the structure used for the refinancing of Lakeside and MetroCentre, which enabled Liberty to obtain capital market debt pricing while retaining the flexibility of a bank loan.”
Eurohypo head of securitisation Caroline Philips said: “This loan involves two different assets, but they are not cross-collateralised, merely bundled together, which means the client saves in upfront costs.”
References: EGi News 15/04/05
