API reduces loans as swap rate rises
Abrdn’s Property Income Trust has extended its £165m debt facility with Royal Bank of Scotland International.
API currently has a £110m loan and a £55m revolving credit facility, of which £17m is drawn. The facility will be repaid using proceeds from the £21.7m sale of its industrial investment in Rainham, east London.
Both facilities are due to expire in March 2023. The LTV as at 30 June 2022 was 21.05%.
Abrdn’s Property Income Trust has extended its £165m debt facility with Royal Bank of Scotland International.
API currently has a £110m loan and a £55m revolving credit facility, of which £17m is drawn. The facility will be repaid using proceeds from the £21.7m sale of its industrial investment in Rainham, east London.
Both facilities are due to expire in March 2023. The LTV as at 30 June 2022 was 21.05%.
An extension has been agreed for a three-year tenor, with a term loan of £85m and an RCF of £80m. The new facility will start in March 2023 with a margin of 150bps over Sonia for both the term loan and the RCF.
Jason Baggaley, API’s fund manager, said: “The margin of 150bps is very competitive, and reflects that relationship along with the quality of the portfolio. The impact of the elevated swap rates is disappointing, and we have reduced the size of the term loan as a result.”
Abrdn has entered into a forward interest rate swap on the full amount of the term loan. The RCF will have a floating rate based on the prevailing Sonia rate. The cost of the swap is 5.47%, giving an all-in rate of 6.97% on the £85m borrowed under the term loan.
It is intended that the term loan will be fully drawn on commencement. The RCF will be used to provide liquidity for the company, and the board intends to retain an LTV of between 20% and 30%.
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