Land Securities has announced a new £1.3bn secured revolving credit facility (RCF) at an initial LIBOR margin of 75 basis points with an initial eight-bank club of international lenders.
The initial five year RCF, which Land Securities has an option to increase to seven years, has built in margin increases dependent on utilisation amounts. Land Securities has the option to extend the facility and remains in discussion with prospective lenders.
The eight-strong syndicate consists of were four book runners and mandated lead arrangers:
- Lloyds Banking Group,
- Santander Global Banking and Markets,
- Royal Bank of Scotlandand
- HSBC Bank,
The four lead arrangers were:
- Sabadell Bank,
- Bank of China; and
Lloyds Banking Group also acted as facility agent and co-ordinator.
The new RCF replaces the existing £1.085m syndicated RCF, first put in place in December 2011 with a headline margin of 120 bps over LIBOR for the first third of the facility.
The 45 bps margin reduction in just over three years is considerable and reflects superior terms than the 9o bps headline margin which British Land achieved for its £485m five-year RCF in February, although this was an unsecured facility which commands a margin premium for increased flexibility.
Martin Greenslade, chief financial officer at Land Securities said: “We are pleased with this new refinancing arrangement, which extends the duration of our bank facilities, reduces costs and provides great flexibility. Our strong relationships with our core banking group, combined with our clear and consistent strategy have been the key elements in achieving these competitive terms.”