Legal & General Property has agreed a refinancing of its £250m Leisure Fund.
The investment manager has secured a new £71m, five-year facility with current lender, Royal Bank of Scotland, on terms which reduce its cost of debt by 2%.
It has also agreed a further £40m loan which can be drawn down for future investment.
The refinancing comes in the same week as the fund emerged as the front-runner to buy the Stevenage leisure park in Hertfordshire from Aviva Investors for just over £40m – a yield of around 6.5%.
L&G beat competition from five other funds in the initial round of bids and is understood to have edged out the Universities Superannuation Scheme and DTZ Investment Management to put the park under offer.
The refinancing comes just months after L&G, on behalf of the Leisure Fund, completed a £42m equity raising from existing investors and extended the fund’s life from 2014 to 2020.
Fund manager Andrew Ferguson said the flexibility and liquidity provided by the new facility will enable the leisure fund to further expand and develop its existing portfolio.
He added that the fresh equity and debt give the fund, which is one of the highest-yielding unlisted UK funds, “a strong platform from which to grow its successful story of market outperformance”.
The fund, which was formed in 2002, owns seven assets, including the Millennium leisure park in Greenwich, and is forward funding the Westgate leisure development in Aldershot with Citygrove and Rushmoor council.
