Terrace Hill completes EUR 29m refinancing of London asset

Terrace Hill Group, an AIM-listed property development and investment company, has arranged a £27.45 mln (EUR 28.96 mln) refinancing with Alliance & Leicester for its 129 Wilton Road asset in London. The investment facility replaces the previous development funding provided by Hypo Real Estate.

Terrace Hill said the new facility allows it to take advantage of the reduction in medium term interest rates and secure its funding at historically low levels. The new funding arrangement allows conservative gearing of up to 50% LTV on a high quality, prime office asset with a maturity of date of January 2011.

More than 2,000 m² of 129 Wilton Road is already occupied, with three of eight floors let to energy company E.ON, on a 10-year lease at rents ranging between £68.50-72.50/per square foot. Pret a Manger occupies 2,180 square feet (around 200 m² ) of retail space on the ground floor on a 15-year-lease, which produces an annual rent of £100,000 (£82.09/per square foot).

Philip Leech, CEO of Terrace Hill, said: 'Completing this refinancing arrangement with historically low interest rates, particularly in the current market environment, is a strong endorsement of both the quality of the building and Terrace Hill’s asset management strategy and, allied to the strong brands we have already attracted to the building, demonstrates Alliance and Leicester's confidence in the potential benefits that can be unlocked going forward.'