Civitas Social Housing announces £60m loan facility with option for further £40m – Civitas Social Housing (CSH) has this morning announced that it has agreed a £60m 5 year term loan facility with national Westminster Bank Plc (NatWest). The loan agreement includes the option to extend for an additional two years as well as the option of a further £40m from the bank.
CSH says that the facility is based upon a competitive margin over three-month LIBOR that has been fixed by way of a five-year swap. The margin level of the facility is consistent with the company’s existing investment quality debt and is secured by a ring-fenced portfolio of certain of the company’s existing properties. The accordion option (for the additional £40m) can be requested by CSH during the first 18 months of the facility and is subject to bank consent.
Greater financial flexibility
The new loan facility increases the company’s financial flexibility and broadens the profile of the existing debt. CSH says that it also demonstrates the continued attraction of the supported housing sector to major lenders in the UK who benefit from a detailed understanding of the positive eco-system in which the company’s properties reside.
Michael Wrobel, chairman of Civitas, said the following: “We are delighted to have secured this new competitively priced facility, which follows a detailed programme of due diligence and independent third-party valuation by the bank. The facility will enable the delivery of further safe, high quality homes for vulnerable adults in the UK.”
[QD comment: This is a welcome development for CSH. The new facility will allow for further portfolio development, bringing with it additional benefits of scale. The competitive and flexible nature of the facility should also support an enhancement in CSH’s dividend cover.]
CSH: Civitas Social Housing announces £60m loan facility with option for further £40m