BLP advises Aviva Commercial Finance Limited in relation to loan to Kennedy Wilson Real Estate to finance the acquisition of £503 million UK portfolio

London headquartered international law firm, Berwin Leighton Paisner LLP (BLP), has advised Aviva Commercial Finance Limited (Aviva) in relation to the £352m debt facility provided to Kennedy Wilson Europe Real Estate (KWE) to finance the acquisition of 180 UK property assets from multiple receivers.

The purchase of the 3.5m sq ft portfolio was funded by Aviva at 70% loan-to-value, together with equity from KWE.

The portfolio is 98% occupied and primary sector uses include retail, food and convenience. Strong institutional grade properties in the portfolio include the Travelodge at King’s Cross and the Asda Superstore in Hemel Hempstead.

Commenting on the deal, BLP Real Estate Finance Partner Naveen Vijh said: “We are pleased to have been given the opportunity to advise Aviva in relation to this exciting deal and to be involved in the formative stages of Aviva’s new relationship with KWE. Given the complex nature of the portfolio (mixed use and including properties across England, Wales and Scotland) we are extremely pleased to have been able to meet the strict timetable for exchange and completion agreed between the parties. Our involvement in this deal serves to further advance our already impressive standing in the real estate finance market. Aviva is an innovative and dynamic client to work with and we look forward to working with them further in 2015.”

Ewan Tocher, Managing Director, Aviva UK Life Commercial Mortgage Restructuring, commented: “The sale of this portfolio was central to concluding our property restructuring strategy for 2014 and we are very pleased that the high quality nature of the assets and income streams were attractive to KWE as an investor. The sale has allowed Barry Fowler’s team in Aviva Commercial Finance to establish a new relationship with KWE through the provision of a new long term debt facility. With gilt yields at all-time lows, we can offer attractive and competitive all-in financing costs for quality portfolios owned by experienced operators and we are keen to develop this relationship further.”

Mary Ricks, president and CEO of KWE, said: “This significant portfolio acquisition allows us to access a high quality, mixed-use portfolio with strong tenant covenants generating robust income streams at a material discount to the original loan amounts. The portfolio benefits from a number of institutional quality investments with good individual asset liquidity across the remaining portfolio. There are significant asset management angles, including growing income through lease re-gears, renewals, rent reviews and the leasing up of vacant space.”

BLP Real Estate Finance head Naveen Vijh led the transaction, assisted by senior associate Eleanor Penton and associates Katie Goodfellow and Joseph Wong. BLP Real Estate specialist Camilla Brignall provided the Real Estate capabilities.



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