Member Article

Intu Properties reveal new debt funding platform

Intu Properties, formerly known as Capital Shopping Centres, has unveiled a debt funding platform that will become the main source of finance for the Group.

The company is a real estate investment trust (REIT), previously owned by North West property mogul John Whittaker, that makes investments in large shopping complexes across the UK.

Intu made a further announcement on Wednesday morning that it has acquired the Milton Keynes-based shopping centre, Midsummer Place, for a consideration of £250.5m.

Plans were revealed to finance four of the firms existing retail parks with the new debt funding platform, including intu Lakeside in Essex, intu Braehead in Glasgow, intu Watford and intu Victoria Centre in Nottingham.

This secured group structure (SGS) will issue bonds and raise bank debt secured against them from an initial borrowing of £1,150m.

Intu said the platform will reach a refinancing and maturity extension on approximately one third of the Group’s debt and more than 55% of its debt that is due to fall in the next three to five years.

Finance director, Matthew Roberts, said: “We are pleased to announce the establishment of a vehicle for issuing investment grade debt which will become a central financing platform for the Group.

“This robust and flexible platform diversifies the Group’s sources beyond the banking markets and brings the considerable benefits of ready access to debt markets through an investment grade rating, access to longer maturities and ability to issue a range of instruments at competitive margins.”

Intu’s Milton Keynes purchase will see the Group take a 100% freehold interest in the Midsummer Place centre, which has an annual footfall of 17m and retail space valued at £7.1bn.

David Fischel, Intu’s chief executive, said: “We are delighted to have agreed terms to acquire this prime asset which addresses a gap in our UK regional coverage.

“As well as strong current operating metrics and good demographics, Midsummer Place offers considerable scope for rental growth.

“The acquisition fits well with our strategy of focusing on the best shopping centre destinations across the country.”

This was posted in Bdaily's Members' News section by Miranda Dobson .