Debt Refinancing

Life Science REIT PLC

27 June 2023

 

27 June 2023

LEI 213800RG7JNX7K8F7525

Life Science REIT plc

("Life Science REIT" or the "Company")

Debt Refinancing including the Company's first Green Loan

Syndication and extension of existing debt facility with HSBC and Bank of Ireland

New facility secures development funding for Oxford Technology Park

The Board of Life Science REIT (LSE: LABS), the real estate investment trust focused on UK life science properties, is pleased to announce that it has refinanced its existing £150 million Term Loan and Revolving Credit Facility ("RCF") secured on its existing portfolio, including Oxford Technology Park ("OTP"). The refinanced Term Loan and RCF have been provided by existing lender HSBC, with an additional lender, Bank of Ireland ("BoI"), also joining the banking syndicate (collectively the "Lenders").

The HSBC and BoI facilities include a £100 million fully drawn term loan, increased from £75 million, and a £50 million RCF facility, both of which have had  their terms extended to March 2026, with two further one year extensions available, if required. Both facilities are split 60:40 between HSBC and BoI, respectively. Additionally, the Company has a £35 million accordion facility available on the RCF, if required.

Both facilities now carry a cost of SONIA plus a 2.50% margin. The SONIA reference rate on both facilities has been capped at 2.00% per annum until March 2025. The facility also includes a ratchet clause that reduces the margin rate to 2.35% if the Gross Loan to Value ratio decreases to 30% (based on the Lenders' annual valuation of the portfolio).

The Company has also defined £40 million of the Term Loan facility as a Green Loan in accordance with the LMA Green Loan Principles, secured on Rolling Stock Yard in London and completed OTP buildings, which are rated either BREEAM Excellent or EPC "A".

Following this refinancing £48.7 million remains available in the RCF to be utilised in funding the ongoing development at OTP which will be drawn on a quarterly basis to meet development funding requirements and minimise interest costs throughout the remaining development period.  The Company is currently progressing 388,400 sq ft of development at OTP, set to be completed by 2024.

The Company repaid the development debt facility acquired with OTP in February 2023, which carried a significantly higher interest rate.

Simon Farnsworth, Managing Director of Ironstone Asset Management Ltd, the Company's Investment Adviser, said:

"We are pleased to have completed this refinancing which increases the Company's overall funding capacity and extends the term of the debt . The new facility includes the Company's first ever Green Loan, reflecting the high quality and excellent sustainability credentials of the portfolio's buildings. 

"In this more challenging economic environment, this refinancing represents a highly positive outcome for the Company and we are delighted to welcome Bank of Ireland to the syndicate."

Enquiries:

Link Company Matters Limited - Company Secretary
[e-mail]
Ironstone Asset Management - Investment Adviser
Simon Farnsworth / David Lewis / Joanna Waddingham	via Buchanan below
Panmure Gordon (UK) Limited -Joint Corporate Broker	[phone]
Alex Collins / Tom Scrivens
Jefferies International Limited - Joint Corporate Broker	[phone]
Tom Yeadon / Andrew Morris / Oliver Nott / Harry Randall
G10 Capital Limited - AIFM	[phone]
Verity Morgan-Jones / Paul Cowland
Buchanan - Financial PR	[phone]
Mark Court / Henry Wilson / Verity Parker
[e-mail]

Notes to editors

Life Science REIT plc is a specialist property business focused on the UK's growing life science sector. The Company's portfolio of assets is located across the "Golden Triangle" of research and development hubs in Oxford, Cambridge and London's Knowledge Quarter and its strategic vision is to become the property provider of choice for life science companies in the UK.

Life Science REIT is addressing the acute demand-supply imbalance for laboratory space in the "Golden Triangle", which is characterised by low vacancy rates and prime rental increases. The UK life science sector itself is benefiting from a buoyant early-stage funding environment, driving demand for laboratory space.    

The Company's diverse portfolio of assets ranges from a 20-acre science park currently under development through to fully let buildings, with an important part of the Company's strategy being the conversion of existing properties to laboratory space.

The Company's investment policy is focused on capital growth whilst also providing a growing level of income.

Life Science REIT trades on the Main Market of the London Stock Exchange under the ticker LABS.

Further information is available at https://lifesciencereit.co.uk. To sign up for email alerts, please visit https://lifesciencereit.co.uk/investors/.

 

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