Arlington Advisors borrows a further £31.2m from the capital markets to refinance and consolidate a student accommodation portfolio
The transaction sees Arlington Advisors (“Arlington”) consolidate its 1,494 bed student accommodation portfolio, operated by Study Inn, into a single long-dated portfolio funded by a project finance bond structure. ASH8 Debt Co UK 1 PLC tapped its bonds issued in December 2017 and used the proceeds to acquire assets in Cambridge and Sheffield.
The Bonds are now secured by ten student accommodation assets – those located in Coventry and Nottingham from the time of original financing and the additional sites in Cambridge and Sheffield.
The Study Inn Group was acquired by Arlington in December 2017 for around £135m, with eight of the assets financed through a 38-year fully amortising bond structure comprising around 73% of RPI linked bonds. The coupon on the index-linked tranche is 0.419% and the coupon on fixed bonds is 3.651%, meaning that each tapped series was issued at a slight discount.
The Study Inn Group assets are predominantly direct-let with some short term university nominations in place up to 2020.
TradeRisks acted as arranger and dealer for the bond issuance and was advised by Osborne Clarke LLP. McGuire Woods (legal) and DWPF (financial) advised Arlington.
John Coleman, Director at TradeRisks said, “Tapping the bond structure assembled last December allowed Arlington to expeditiously access new funding at an attractive all-in cost and in a way that diversified the security portfolio backing the bonds”.
For further information please contact John Coleman on 020 7382 0990 or johncoleman@traderisks.com