Aliseda Refinances Bank Debt To Lower Costs

15 December 2015 – Expansión

Loan / Popular, Bankia, Santander and Sabadell are leading a five-year syndicated loan to the real estate management company, amounting to €450 million.

Cheaper debt and new money to manage its needs over the next few years without any hardship. Resources are cheap at the moment, banks are willing to lend and companies are taking advantage of the environment to line their pockets and face up to the recovery. Few companies are letting the opportunity pass them by and Aliseda is not one of them.

The real estate services company, owned 51% by Värde Partners and Kennedy Wilson and 49% by Banco Popular, has just closed a five-year financing agreement that reflects all of the benefits of the new lending era in Spain. Eight banks have put €450 million on the table, in a syndicated loan that has two objectives.

The first is to refinance the €350 million debt that Aliseda took on when Popular sold the management of its real estate assets to two funds specialising in the subject. That financing agreement was signed at the end of 2013 and the interest that the firm paid on it was in line with market rates at the time. It is true that it wasn’t the worst time to be raising funds (the lows of the crisis and the credit freeze had already passed), but nor was it the best time.

Since then, Aliseda has been trying to refinance its loan (…). The financing granted in 2013 did not mature until 2018, but the company has decided to repay it early and replace it with a new lower-cost product. The result is a loan, due to mature in 2020, for which it will pay an interest rate of 350 basis points above Euribor, according to market sources, which represents a decrease with respect to its previous rate, given that the final cost will amount to approx. 3.5%.

New money

The second objective for the company, which manages loans granted to real estate developers and construction companies, as well as the assets foreclosed by Popular (its total portfolio amounts to €30,000 million) was to raise new funding. And it has achieved it.

And Aliseda is exceeding its objectives for asset sales this year; it had accumulated €1,588 million of divestments by the end of the third quarter. The goal for 2015 is to reach €2,000 million, although the company expects to exceed that threshold.

But Aliseda does not want to continue only with the management and sale of Popular’s assets; rather it is looking for new business lines and projects for the future. As such, it has decided to promote its own homes. And for that, it needed this additional funding.

Eight banks have provided the money. Naturally, Popular has led the loan and is the entity providing the most funding, although Bankia, Santander and Banco Sabadell have each signed a tranche amounting to more than 10% of the syndicated balance. BBVA is providing a very similar stake, along with Bankinter, whilst ING and Crédit Agricole are taking on smaller exposures.

Six of these banks were involved in the original financing agreement in 2013; only CaixaBank has left the original group; meanwhile, Bankia and ING have taken their place as new lenders.

Original story: Expansión (by Inés Abril)

Translation: Carmel Drake

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