Landesbank Baden-Württemberg (LBBW) has refinanced three assets in Michael and Steven Elghanayan’s EPIC portfolio with a five-year £70m senior loan, in one of three separate deals which amount to just under £250m in total.
The EPIC assets are: Burlington Gardens in Mayfair, comprised of 39,000 sq ft of office space, 4,000 sq ft of restaurant space and 1,418 sq ft of retail; the 150,000 sq ft 125 Colmore Row (pictured) in Birmingham fully occupied by Lloyds TSB Bank; and 22-25 Queen Square in Bristol, comprised of 16,000 sq ft of office space, fully let to the law firm Mewburn Ellis, and 2,000 sq ft of retail space.
CoStar News understands that the current value of the three EPIC portfolio assets is circa £145m, which would reflect a 48.3% LTV.
LBBW’s EPIC portfolio mini refi is one of three senior debt deals closed by the German bank this year, as the lender seeks to establish a prime UK bilateral senior debt lending business with ambitions to lend more than £500m this year.
The German bank has an appetite to write £100m-plus loans in single deals.
Historically, LBBW has been more of a syndicated loan purchaser in the UK, as well as a buyer of CMBS notes, and in recent years has only written bilateral loans in Germany.
LBBW’s UK senior debt business is headed by John Cole, who joined from Santander in July 2012, with a mandate to lend on prime office and retail properties in primarily London.
Last month, EPIC acquired 1 The Avenue in Manchester’s Spinningfields from IM Properties for £20m. The 50,000 sq ft building is fully let to tenants including Australasia, Armani, Pinsent Masons, Brewin Dolphin and Outsourcery.
EPIC’s investment strategy is to secure low risk and high return investments that are acquired and financed with low leverage, long term fixed rate finance. EPIC has raised equity finance on both sides of the Atlantic from private, high net worth individuals and financial institutions, and invested through limited partnerships and joint ventures.
EPIC owns and manages approximately 2m sq ft of residential, commercial, office and retail space, with a value in excess of $1.5bn.