- What Brookfield has arranged a £515m financing deal for London Wall Place
- Why The company bought the 50% it did not own of the scheme as it continues to see relative value in the London market
- What next The debt is in place for the next five years
Brookfield has agreed a refinance of 1 & 2 London Wall Place, having taken full control of the £700m scheme, React News can reveal.
A five-year financing package from a trio of lenders has been put in place.
Deutsche Bank and Morgan Stanley have jointly provided a whole loan of close to £515m, pari passu. The duo of investment banks has retained a £406m piece, reflecting a loan-to-value of close to 60%. A mezzanine piece of £109m, which sits at a loan-to-value of close to 75%, was syndicated to Apollo Global Management.
The 500,000 sq ft office project, which includes Schroders’ 310,000 sq ft London headquarters at 1 London Wall Place, was originally funded using a £130m development loan from Wells Fargo, issued in 2014.
A bullish outlook on London
Brookfield completed a deal to buy the 50% of London Wall Place it did not own from Oxford Properties last week in something of a reversal, having briefly considered offloading its own portion.
The investment and development colossus has turned the tap on dramatically in London as it sees relative value compared to other European markets such as Paris and Frankfurt where yields have tightened considerably, leading it to take back control of development sites and purchase new, relatively dry, assets.
As well as its purchase of Oxford’s portion of London Wall Place, earlier this month it agreed terms to buy Nexus Place in Farringdon for around £172m from Barings Real Estate, an income play which is set to benefit from its proximity to Farringdon station and the incoming Elizabeth Line.
It has also pulled a deal with Munich Re to sell the German reinsurance company its 1 Leadenhall project, opting instead to press on with the 540,000 sq ft, £600m project on its own as it looks to take advantage of the buoyant leasing market.
No shortage of big ticket lending deals
Brookfield has been keeping lenders in the City busy in recent times, and last month also struck an £885m agreement with First Abu Dhabi Bank; AXA; Bank of China; ING and Standard Chartered Bank to refinance 100 Bishopsgate. The financing for the £1.5bn project sits at an LTV in the region of 60%.
Apollo has been similarly active on the lending side in London. The company is in the process of finalising an £850m development loan to bring forward Meyer Bergman and Warrior Group’s £1.3bn Whiteleys project in Bayswater.