Urban Logistics REIT Refinances £151m Debt, Acquires Four Assets

Urban Logistics REIT has completed a significant refinancing of its debt, replacing its existing £100m term loan and £51m revolving credit facility with a new £140m term loan and £50 million revolving credit facility. The company has also used the proceeds to acquire four assets, totaling £42.2m at a blended net initial yield of 6.6%. The refinancing has secured a fixed interest rate of 4.48% until August 2025 and 4.98% until maturity in 2027.

The new debt has allowed Urban Logistics to deploy additional capital into the acquisition of carefully selected buildings at attractive initial yields, providing immediate earnings accretion. The company has identified opportunities for asset management initiatives that could unlock further potential income and total return enhancement. The new debt brings a small increase in pro forma LTV to 32.6%, which remains within the company's medium-term target of 30-40%.

Richard Moffitt, of Urban Logistics, commented that the refinancing supports the growth in earnings while maintaining balance sheet discipline and low LTV. The company is actively seeking to sell selected assets where asset management initiatives have been completed, reinvesting the proceeds into new assets that provide a good income return and asset management opportunities.

Key Takeaways:

• Urban Logistics REIT has refinanced its existing £100m term loan and £51m revolving credit facility with a new £140m term loan and £50 million revolving credit facility.
• The new debt has a fixed interest rate of 4.48% until August 2025 and 4.98% until maturity in 2027.
• The refinancing has allowed Urban Logistics to acquire four assets, totaling £42.2m at a blended net initial yield of 6.6%.
• The acquisitions include a 145,998 sq ft unit in Wolverhampton, a 130,676 sq ft unit in Doncaster, a 108,897 sq ft unit in Peterlee, and a 28,938 sq ft unit in Dartford.
• The new debt has increased the company's pro forma net LTV to 32.6%, within its medium-term target of 30-40%.
• Urban Logistics is actively seeking to sell selected assets where asset management initiatives have been completed and reinvesting the proceeds into new assets.

Statistics:

• £151m - refinanced debt
• £140m - new term loan
• £50m - new revolving credit facility
• 4.48% - fixed interest rate until August 2025
• 4.98% - fixed interest rate until maturity in 2027
• 32.6% - pro forma net LTV
• 30-40% - medium-term target LTV
• £42.2m - total purchase price of acquired assets
• 6.6% - blended net initial yield of acquired assets
• 4.1 years - WAULT to first break of acquired assets
• 7.1% - reversionary yield of acquired assets
• 0.4m sq ft - additional logistics real estate space added to the company's portfolio

Sources:

• Association of Investment Companies (AIC)
• Urban Logistics REIT press release