TradeRisks arranges £90m guaranteed financing for two new colleges at Durham University
The bond issue by Mount Oswald Colleges LLP will finance the construction of two new colleges designed for student residence at Durham University (the University).
The 46-year RPI linked bonds are rated AA by S&P Global Ratings, benefiting from a guarantee by Assured Guaranty (Europe) plc (AGE), and were privately placed by TradeRisks with a single investor. The pricing on 14 August 2018 took advantage of low long-term rates.
Interserve will build the halls within two years, and Campus Living Villages (CLV) will undertake facilities management services over the project term. Equitix is the main sponsor of the project company, with CLV as a co-sponsor. The University has a 15% stake in the project company.
The two new colleges financed by the bonds will provide a total of approximately 1,000 new bedspaces for Durham students. Both colleges will be located on campus, next to existing colleges, and are designed to house both undergraduate and postgraduate students in a mix of en-suite and townhouse units.
John Coleman, Director at TradeRisks, said: "We are delighted to have supported the sponsors and the University in this financing, which will help the University to deliver its estate masterplan. This transaction highlights the advantageous financing conditions for student accommodation projects in the low rate environment.”
TradeRisks acted for the sponsors as the bond lead manager, advisors to AGE were Ashurst (legal advisor), Aecom (technical advisor), Cushman & Wakefield (demand advisor) and Willis (insurance advisor).
For further information please contact John Coleman on 020 7382 0990 or johncoleman@traderisks.com.