Germany's largest property company IVG Immobilien has received a EUR 455 mln long-term financing facility from a bank consortium led by Commerzbank for the purchase of a portfolio of 30 caverns still under construction. The acquisition is earmarked for the IVG Caverns fund, which was launched in 2008 with EUR 910 mln of equity commitments from institutional investors.
Germany's largest property company IVG Immobilien has received a EUR 455 mln long-term financing facility from a bank consortium led by Commerzbank for the purchase of a portfolio of 30 caverns still under construction. The acquisition is earmarked for the IVG Caverns fund, which was launched in 2008 with EUR 910 mln of equity commitments from institutional investors.
Law firm Clifford Chance advised IVG on the deal.
The caverns, underground storage facilities for oil and gas, have secure long-term tenancy agreements and will be transferred step by step between now and 2014 as they are completed. IVG has a EUR 50 mln co-investment stake in the fund, which is expected to have an average annual pay-out of 7.8%.
Separately, IVG said it has redeemed about EUR 120 mln of the so-called SynLoan II from 2009, as part of a plan to reduce its loan-to-value ratio (LTV) from 70% to a range of 60-65%.
Core element of the debt relief programme is the scheduled use of proceeds from transfers of the caverns to the IVG Caverns fund, it added. The next big redemption of about EUR 180 mln is scheduled for spring 2011. In total, this year about EUR 200 mln and in 2012 about EUR 290 mln will be redeemed.
