BLP advises Capital & Regional on £372.5M financing and corporate restructuring of the Mall fund

A cross-departmental BLP team have advised listed REIT, Capital & Regional PLC, on the refinancing of their existing loan facilities secured on the Mall fund and a corporate restructuring of the Mall fund, a portfolio of five shopping centres located in Blackburn, Maidstone, Wood Green, Walthamstow and Luton.

The finance work resulted in the repayment of the existing £334.6m debt secured against the Mall and replacement of the existing indebtedness with:

  • a £165m 10 year loan with Teachers Insurance and Annuity Association of America with a one year extension option;
  • a £107.5m seven year loan with Wells Fargo Bank International Unlimited Company; and
  • a £100m bank facility of five years with two one year extension options with The Royal Bank of Scotland. £90m of this facility has been drawn down with a further £10m available to fund capex.

The Wells Fargo facility is secured on The Mall, Luton, while the RBS and TIAA facilities are secured on the four assets at Blackburn, Maidstone, Walthamstow and Wood Green.

In addition to the refinancing the corporate, tax and real estate finance teams advised on the split of the fund into two separate groups. the ‘Luna’ structure containing only the Luton property and the ‘Macadamia’ structure containing the Blackburn, Maidstone, Wood Green and Walthamstow properties.

This restructure and refinancing is a continuation of BLP’s relationship with the Mall fund which has been ongoing since 2001 and which has continued through the acquisition of the entirety of the Mall fund by Capital & Regional following the completion of the May 2014 financing of the fund. The transaction further underlines BLP’s ability to work on high value structured transactions and financing matters in the real estate sector as well as the team’s ability to deliver complex transactions in tight timeframes.

Claire Watson, Partner, Real Estate Finance, said: “We were delighted to be instructed by Capital & Regional PLC on the refinance and restructure of the Mall fund and in particular to be able to assist them with locking in long term financing at historically low rates. This further underlines market sentiment that competitive debt terms remain available for sophisticated sponsors.”

Claire Watson, Gordon McMillan, Benedict West, Lucy Morton and Merve Danagoz acted on the real estate finance elements of the transaction. Antony Grossman, Elliott Gold and Matthew Birchall acted on the funds restructuring and Richard Harbot and Andy West advised on the tax aspects of the transaction. Louise Martin advised on the hedging arrangements.

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