Regional REIT has agreed a new £165 mln (€187 mln) secured 10-year facility with Scottish Widows and Aviva Investors Real Estate Finance, arranged by Bank of Scotland.
The new facility replaces five existing secured debt facilities thereby reducing the number of group debt facilities from nine to five. It also increases the average maturity of the group debt to 6.2 years from 2.5 years.
Regional REIT said that the loan has a 'very competitive fixed rate' which will be set on the date of drawdown and is anticipated to be 330 basis points to 340 bps, resulting in the group cost of borrowing, including hedging, remaining at 380 bps.
This refinancing follows the recently announced £52.4 mln 5-year facility agreed with Santander UK.
'This refinancing simplifies our balance sheet, lengthens the average maturity of our debt, and better aligns our financing arrangements to our real estate strategy,' said Stephen Inglis, Chief Executive Officer of London & Scottish Investments, the asset manager of Regional REIT.
Regional REIT is managed by London & Scottish Investments, the asset manager, and Toscafund Asset Management, the investment manager, and was formed by the combination of two existing funds previously created by the managers as a differentiated play on the expected recovery in UK regional property.
As at 30 June 2017, the investment portfolio had a value of £640.4 mln and a net initial yield of 6.7%.
