Former intu SGS shopping centres to undergo £445m recapitalisation

The group of creditors behind a quartet of former intu shopping centres has agreed a £445m debt facility with a lender in a major recapitalisation plan for the assets. The SGS portfolio, which comprises the Lakeside Shopping Centre in Thurrock, Atria Watford in Hertfordshire, and centres in Nottingham and Braehead, had a combined December book value of £858m. Creditors took the reins of the portfolio after intu collapsed into administration in 2020. A £395m senior loan and an additional £50m capital expenditure facility have been agreed with Lloyds Banking Group, ahead of the portfolio’s debt maturities on 31 March. The loan will have an initial maturity in 2028, with scope to be extended by up to a further year. The senior loan would help deliver a £452.1m net debt repayment to existing lenders, according to SGS documents filed earlier this week. Under the proposed recapitalisation, the debt will be converted to equity so that investors own 100% of the shareholding. In its existing structure, the portfolio is owned by a charitable trust. Former Unibail-Rodamco-Westfield chief financial officer Jaap Tonckens has been lined up to lead the board as non-executive chairman. Tonckens is also a senior advisor to Value Retail. The portfolio’s £858m valuation marks a 21% increase in value since 2021. The centres have been managed by Global Mutual since the creditors took control of the portfolio. Static net rental income also increased by 22% to £80.5m in December, compared with June 2022 when it was reported for the first time. Some £74m has been invested in asset management initiatives during the period, alongside a further £68m from tenants. A further £82m of capital is committed to asset management initiatives by March 2027. Photo © SGS