GCP Student Living Acquisition of asset and borrowing arrangements

 
TIDMDIGS 
 
GCP STUDENT LIVING PLC 
 
 (the "Company" or "GCP Student Living", together with its subsidiaries, the " 
                                    Group") 
 
Acquisition of asset and borrowing arrangements 
 
Acquisition of Woburn Place, London WC1 
 
The Directors of GCP Student Living, the UK's first REIT focused on student 
residential assets, are pleased to announce that, further to the announcement 
on 8 March 2017, the Company has now completed the acquisition of Woburn Place, 
London WC1. 
 
The acquisition has been funded through a mixture of available cash resources 
and the new borrowing arrangements. 
 
Borrowing arrangements 
 
The Company has entered into an agreement with PGIM Real Estate Finance which 
is part of the US based financial services group Prudential Financial (NYSE: 
PRU). PGIM and the Company have agreed to increase the Company's existing GBP130 
million secured debt facility entered into on 25 September 2015 by a further GBP 
40 million. The increased GBP170 million facility is repayable on 30 September 
2024 and the cost of debt on this loan has been reduced from 3.07% to 3.01%. 
The security package remains unchanged. 
 
The Company has further entered into a new GBP65 million facility with PGIM, of 
which GBP50 million has been drawn at a fixed cost of debt of 2.82%. The Company 
will draw the remaining GBP15 million in September 2017 at the same fixed cost of 
debt. The facility is repayable in 2029 and is secured against certain of the 
Company's assets. 
 
Accordingly, the Company's banking facilities total GBP235 million, of which GBP220 
million is drawn, at a blended cost of borrowing of 2.96% and with an average 
weighted maturity of 8.75 years. The loan-to-value of the Group is 
approximately 32%. 
 
The new borrowings will primarily be used to fund further investments, 
including the acquisition and refurbishment of Woburn Place and, if acquired, 
the purchase of Podium, Royal Holloway London, which the Company has 
conditionally agreed to acquire and is currently expected to be completed for 
the 2017/18 academic year. 
 
Commenting on the acquisition and new borrowings, Robert Peto, Chairman, said: 
 
"We are delighted the Company has been able to secure the acquisition of Woburn 
Place which, following refurbishment, will offer c.420 modern beds to students 
in the heart of London close to several globally recognised universities 
including UCL, Kings College London, the LSE and SOAS. 
 
The Company continues to see new and exciting opportunities in the student 
residential accommodation market, with the Investment Manager currently 
conducting due diligence on a high quality asset which may meet the Company's 
highly selective investment criteria and which is located in a city centre 
location in close proximity to a top 20 UK university. 
 
In addition, the Board are pleased to further the Company's relationship with 
PGIM. PGIM is a key partner of the Company as its provider of long-term 
financing at attractive rates of borrowing." 
 
Commenting on the loans, Bryan McDonnell, a Principal with PGIM's London 
office, said: 
 
"We are excited to expand our relationship with one of the leading providers of 
student accommodation in the UK. This transaction was a good partnership of 
PGIM Real Estate Finance and GCP Student Living, who both see an opportunity to 
enhance value in the short term and share a common vision for the long-term 
success of the sector in London and beyond." 
 
For further information, please contact: 
 
Gravis Capital Partners LLP                                         [phone] 
 
Tom Ward                             [e-mail] 
 
Nick Barker                          [e-mail] 
 
Dion Di Miceli                       [e-mail] 
 
Stifel Nicolaus Europe Limited                                      [phone] 
 
Neil Winward                         [e-mail] 
 
Mark Young                           [e-mail] 
 
Tom Yeadon                           [e-mail] 
 
Buchanan                                                            [phone] 
 
Charles Ryland                       [e-mail] 
 
Vicky Watkins                        [e-mail] 
 
About GCP Student Living plc 
 
The Company was the first student accommodation REIT in the UK, investing in 
modern, purpose-built, private student residential accommodation and teaching 
facilities. Its investments are located primarily in and around London where 
the Investment Manager believes the Company is likely to benefit from supply 
and demand imbalances for student residential accommodation. 
 
The Group has an estimated total asset value of c.GBP690 million including six 
standing assets, providing c.2,000 modern studios and beds, and one 
forward-funded development asset which will provide a further c.580 beds on 
completion. A further asset, Woburn Place, will provide c.420 beds following 
refurbishment. 
 
The Company's standing assets are primarily occupied by international students 
and offer high specification facilities and hotel-level concierge type services 
which the Investment Manager believes are attractive to overseas students. 
 
 
 
END 
 

(END) Dow Jones Newswires

April 05, 2017 08:14 ET (12:14 GMT)