Workspace, a London-based business premise provider, has refinanced its pro-forma debt profile through non-traditional lenders, with 62 percent of its debt coming from non-bank sources.
Approximately 38 percent of the company’s new debt profile comes through private placement, while only 37 percent was raised through traditional bank sources, according to an 11 June investor presentation. The remaining 25 percent of the £410 million debt profile comes from a UK fund and retail bonds.
Within the £410 million refinancing, £150 million matures in 2018, £58 million matures in 2019, £9 million matures in 2020 and the remaining £193 million matures in 2023. Workspace’s previous facility included £393 million in secured bank debt as of September, according to investor documents.
The refinancing replaces two bank facilities with “£158m from three US insurance companies via a private placement, a £45m floating rate loan from M&G Investments and £150m of traditional five-year bank debt”, according to a Real Estate Capital report.
“There are always things going on in our properties such as refurbishment and development and unsecured finance gives us the freedom not to have to always be going back to banks to get assets released from secured pools,” chief financial officer Graham Clemett told Real Estate Capital. “If we had tried to do this five years ago, lenders might have turned up their noses. But the lending community has come a long way, we have built up a good track record in the last few years and our corporate covenant is stronger for unsecured borrowing”.
A Workspace spokesperson could not be reached for comment at press time.