AshbyCapital, the real estate investment advisor, has secured a £53m loan facility from Deutsche Hypo for Morfa Retail Park in Swansea.
The financing, at a loan-to-value ratio of 60%, follows the cash acquisition of the retail park by AshbyCapital’s group investment company in December 2015. The facility includes a capex element to fund AshbyCapital’s planned value-add initiatives for the property, the first of which is the expansion of one of the units to provide a new c. 50,000 sq ft large-format fashion and home store for existing tenant Next. This initiative, which is being led by asset manager Quadrant Estates, is already underway and is expected to result in a further increase in footfall to the park. The loan also has potential for future add-on tranches to finance further improvements to the site.
Morfa Retail Park is fully let to retail tenants including Morrisons, Currys PC World, B&Q, Next, TK Maxx, Argos and Sports Direct. Its restaurant tenants include KFC, Pizza Hut, Frankie & Benny’s, Harvester and Starbucks. It is located 1.5 miles to the north of Swansea city centre and directly adjacent to the Liberty Stadium, which is the home ground for Swansea City Football Club and the Ospreys regional rugby team, as well as a major venue for conferences and events.
“With its prime location and excellent roster of retail and restaurant tenants, Morfa Retail Park is the premier shopping centre in the area. We are pleased that Deutsche Hypo has shown its confidence in this fully-let asset and its potential by providing the financing for our recent purchase and our planned improvements.
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Walter Love, Senior Director at Deutsche Hypo London Branch, said: "Deutsche Hypo London Branch is delighted to be assisting AshbyCapital with longer-term financing for the acquisition of this dominant and well-let retail park. Morfa Retail Park shows good upside potential through active management that we are confident AshbyCapital will be able to achieve."