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First Tranche Of Debt Financing Secured
Schroder European Real Estate Investment Trust PLC
(Incorporated in England and Wales)
Registration number: 09382477
JSE Share Code: SCD
LSE Ticker: SERE
ISIN number: GB00BY7R8K77
4 August 2016
FIRST TRANCHE OF DEBT FINANCING SECURED
The Board of Schroder European Real Estate Investment Trust plc (the “Company”)
announces it has entered into the Company’s first debt facility, with Credit Agricole, for €18.2
million. The loan is secured against the two French grocery retail investments acquired on 28
June 2016 and represents a loan to value against those assets of 45% and a loan to value of
approximately 10.5% against the overall gross asset value of the Company.
The seven year interest only loan facility is at a margin of 1.35% above the 3 month Euribor
rate. With Euribor currently negative, it is applied at zero, resulting in a current total all-in
interest cost of 1.35% p.a., comparing favourably with the portfolio net income return of 5.6%
on acquisition. The Company will acquire an interest rate cap to limit the maximum future
potential interest cost if Euribor were to increase, to an all-in rate of between 2.35% p.a. and
2.85% p.a.
Andrew MacDonald, Head of Real Estate Finance at Schroder REIM, commented: “In
accordance with our stated strategy at IPO, we have successfully deployed the Company’s
initial equity and are now raising long term debt against specific assets, at interest rates that
compare very favourably to the property income return of the portfolio.
We will continue to target gearing against those assets where it is most accretive to returns,
whilst maintaining the Company’s maximum gearing cap of 35% LTV at portfolio level. We
are currently in the process of securing additional debt against the Company’s German
assets and plan to deploy proceeds into an identified acquisition pipeline, remaining focused
on large, liquid Continental Europe cities, whose growth prospects exceed their domestic
economies.”
Enquiries:
Duncan Owen/Tony Smedley
Schroder Real Estate Investment Management Limited Tel: 020 7658 6000
Ria Vavakis
Schroder Investment Management Limited Tel: 020 7658 2371
Dido Laurimore/Ellie Sweeney/Richard Gotla Tel: 020 3727 1000
FTI Consulting
Sponsor: PSG Capital Proprietary Limited
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