Home REIT will look to sell more of its portfolio after failing to secure refinancing of its debt.
The company said that extensive discussions with a potential lender to refinance its debt facility with Scottish Widows (currently £131.8m) have fallen through. It said: “The board has now concluded that it will not be able to secure a refinancing of the existing facility on terms that it could recommend to shareholders, despite extensive and advanced discussions with a potential lender.”
It added that it would now implement a strategy to repay the outstanding borrowings in a timely manner, focused on further property sales.
As at 31 May 2024, the company had total borrowings of £131.8m which will be reduced by the proceeds of the most recent property sales, which have exchanged but are yet to complete, totalling around £27m, which would reduce total borrowings to approximately £104.8m.
The company’s property portfolio comprises of 1,765 properties with a value of £314.1m (based on a draft valuation at August 2023).
Michael O’Donnell, non-executive chairman of Home REIT, said: “Whilst the stabilisation strategy adopted in August 2023 has progressed from an operational perspective, re-financing of the debt was a key component of its continued advancement. As a re-financing has not been possible, the Board is considering a number of options both to re-pay the outstanding debt and provide an optimised resolution for shareholders, which may include a more extensive realisation strategy.”