Investment adviser 90 North Real Estate Partners has financed the acquisition of a Sheffield retail park with pbb Deutsche Pfandbriefbank.
90 North, which invests on behalf of Middle-East clients, bought the Drakehouse Retail Park in the city from Hammerson for £61.6m, an initial yield of 6.5%. Hammerson reportedly bought the park 11 years ago at a 5.4% yield.
The German bank provided a four-year, £41m senior facility, equating to a 66% loan-to-value at a margin thought to be well below 200 basis points.
90 North buys assets in Europe and the US. The latest debt facility is 90 North’s second with the German bank – pbb financed the €49m acquisition of a 1.1m sq ft Volkswagen logistics warehouse near Kassel in Germany four months ago.
Matt Hills, partner and UK head at 90 North, said Drakehouse would be held as an investment property and was principally “an income play”, with rent reviews due in the next 1-3 years and potential to re-gear some leases and add a food offer.
Fully-let, tenants include Homebase, Wickes, JD Sports, Currys, Harveys, Halfords, Pets at Home, Sports Direct and Carpetright.
“We don’t generally push LTVs or add mezzanine, so what we’re asking for is something that sits well with the banks”, Hills said. “We generally find the German lenders to be very commercial.”
Article from Real Estate Capital