Business
Extension of financing facilities
Extension of financing facilities.
About this update from Palace Capital Plc
[{"type":"text","content":"\n \nRNS Number : 4810D Palace Capital PLC 07 July 2016 \n\nPalace Capital plc\n(\"Palace Capital\" or the \"Company\")\n \nPALACE CAPITAL EXTENDS FINANCING FACILITIES\n \nPalace Capital, the property investment company that focusses on commercial property mainly outside London, announces that it has taken advantage of the historically low 10-year interest swap rates and completed the refinancing of the existing loan facility on Broad Street Plaza, Halifax. When Palace Capital provided a Portfolio Update in May 2016, it stated that the Company had received credit approval from a major insurance company to replace the existing short term facility of £15.2m, assumed by Palace Capital in March 2016 as part of the Broad Street Plaza, Halifax acquisition. \n \nThe Company has secured a new ten year, fixed rate loan of £15.25m at 2.9035% including margin, with Scottish Widows. This loan provides security of funding costs over a ten-year period matched against rental income on the property which has a fourteen-year weighted average unexpired lease term to break. \n \nFollowing the Company entering into the new facility with Scottish Widows the Company's average debt maturity has been extended from 3.9 years to 5.5 years. \n \nNeil Sinclair, the Chief Executive of Palace Capital, commented: \n \n\"This is excellent news for the Company. As we expand the scale of our portfolio, we are diversifying our funding platform and we have received a significant amount of long-term support from major lending partners. \n \n\"This new facility provides us with secured cashflows, net of debt servicing, of £1.36m per annum, rising to £1.51m per annum next year. We will be receiving an initial pre-tax return on our equity invested in Broad Street Plaza of 15.00%, rising to 16.8% in August 2017, secured for the next ten years. \n \n\"An added bonus is that we will be able to claim considerable capital allowances against Broad Street Plaza which have not been claimed since the development was completed in 2012.\n \n\"Palace Capital is in strong financial health and the Company has already taken advantage of the recent uncertainty in the commercial property market following the June EU Referendum result by putting in place this loan facility. Our portfolio is performin...