Elite UK Reit unit inks £135 million facilities agreement

ELITE UK Real Estate Investment Trust (Reit) has entered into a facilities agreement for term and revolving facilities of up to £135 million (S$235.3 million) over a term of 39 months.

This was done through the Reit’s wholly owned subsidiary Elite Gemstones Properties, announced its manager on Tuesday (Jul 16).

As announced during the time it secured a committed offer from the lenders in March this year, funds from the facilities will be used to refinance the Reit’s existing loans.

The manager added that no amounts under the agreement have been drawn down to date.

Under the agreement, the facilities’ lenders are entitled to require immediate pre-payment of all outstanding loans and accrued interest, among others, should certain “specified events” occur.

Such events include scenarios where the manager’s shareholders, Elite Partners Holdings and Sunway RE Capital, cease to beneficially hold more than 50 per cent of the manager’s issued share capital.

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Should a “specified event” like this occur, the aggregate amount of the facilities and existing outstanding borrowings of Elite UK Reit that may be affected is estimated to come in at £193.4 million.

The estimated sum is assuming that the facilities are fully drawn down and used to refinance and reduce existing borrowings of the Reit by an equivalent amount. It also excludes interest.

Units of Elite UK Reit were trading flat at £0.245 as at 9.33 am on Tuesday, after the news. The Reit’s portfolio includes properties in London, Scotland and Wales.

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While it was still known as Elite Commercial Reit, it was announced on Mar 4 that the Reit received a committed offer for the facilities from a group of financial institutions.

This came as a result of new lending relationships sourced by the manager through the Reit’s sponsors, said the manager at the time.

The manager’s chief executive Joshua Liaw said the ongoing refinancing exercise would allow it to focus on reinforcing the Reit’s capital structure, while maximising unitholder returns through asset repositioning strategies.