At the time of the acquisition of RT Warren (Investments) Limited (“RT Warren”), the Company stated that it had assumed an existing loan from Barclays Bank of £14.5 million. This bank facility was due to expire on 31 January 2018.
In discussions with Barclays Bank, the Company has taken the opportunity of not only agreeing a new, increased 5-year facility secured on the RT Warren commercial properties, but also to repay the Company's £12.7 million facility with Nationwide, which was due to expire in November 2020.
The new facility with Barclays Bank carries a margin of 1.95% over LIBOR, which further reduces the Company's average cost of debt to below 3% and extends the average debt maturity to 4.7 years.
As at 24 January 2018, the company has net debt of £84.2 million, representing a loan to value (LTV) net of cash of 31%. The Company now has combined facilities of £115.4 million, providing greater firepower for further acquisitions.
Neil Sinclair, Chief Executive of Palace Capital, commented: “We are delighted to have entered into this new facility on very competitive terms as we continue to demonstrate one of the lowest overall costs of debt in our sector. We are strong advocates of relationship banking and have been well supported by our key lenders through this latest growth phase. The new facility will enable us to pursue more opportunities to grow both income and capital value, underpinning our commitment to enhance cash returns to our shareholders.”