18th Aug 2015 14:50
LONDON (Alliance News) - Custodian REIT PLC on Tuesday said it has agreed a new term-loan facility providing it with GBP20 million in a deal with Scottish Widows PLC, a life assurance subsidiary of Lloyds Banking Group PLC.
The UK property investment company said it has agreed to repay the money on August 14, 2025. It will pay fixed interest of 3.935% per annum on the balance.
On drawdown, the company will have uncommitted facilities of GBP24.4 million available to deploy, with GBP9.8 million of properties currently under offer and in solicitors' hands.
Net borrowings are 15.5% loan to value, according to Custodian REIT, which said borrowings will increase to 20.9% loan to value on completion of the purchase of the properties in its pipeline. That is in line with the company's objective of increasing gearing - a measure of borrowing - towards a ratio of 25% loan to value.
"Securing long-term, fixed-rate debt at a level significantly below the UK historical average demonstrates our commitment to achieving the target gearing ratio and mitigating risk," Richard Shepherd-Cross, managing director of Custodian Capital Ltd, the company's discretionary investment manager, said in a statement.
Shares in Custodian REIT were up 0.8% at 108.25 pence on Tuesday afternoon.
By Samuel Agini; [email protected]; @samuelagini
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