UK: Urban regeneration specialist Vita Group and Greater Manchester Pension Fund have secured a £126 million debt package from NatWest and Santander UK against the Vita Living BTR apartments at Circle Square in Manchester.
Vita Group partnered with the Greater Manchester Pension Fund in 2017 as a joint venture to build 683 apartments at Circle Square in central Manchester. The apartments come fully furnished, with utility bills included in the rent, and offer communal amenities such as private dining spaces, lounges, coworking spaces and a gym. Since opening in 2022, the apartments have been achieving close to 100 per cent occupancy.
The deal assists the refinancing of existing development facilities and enables “the reimagining of some of the assets’ social and cowork spaces”.
NatWest, which was also involved in the original development financing of the scheme, was appointed as debt co-ordinator on the deal and sought third-party liquidity. Following discussions with several lenders, Santander agreed to provide £42 million, leaving NatWest with a hold level of £84 million.
Michael Slater, chief financial officer at Vita Group, said: “Gaining the backing of these prestigious institutions is of great value for the business and will facilitate the long-term development and operational plans for these market leading assets. Vita Living performs incredibly well in the market, driving demand from city centre renters and achieving high occupancy rates, as a result, it creates a compelling proposition for investors and funds. We’re delighted to have NatWest and Santander on board and look forward to further building upon this relationship.”
Gareth Conroy, director at Avison Young, property adviser to The Greater Manchester Pension Fund, added: “After a successful construction programme, which delivered a first-class development, we look forward to the next phase of the project where the early popularity of the apartments will be built upon. With Vita Group applying their experience of creating highly desirable places to live, new retail and leisure operators filling up the ground floors, we expect the tenant experience to be enhanced over the coming years, ensuring the popularity of the apartments continues.”
Andy Clarke, relationship director at NatWest Group, said: “We are delighted to support Vita Group and the Greater Manchester Pension Fund with their refinance event, by continuing to lend against their exceptional Vita Living apartments in Manchester and arranging the investment term loan with Santander.”
Addleshaw Goddard and CBRE provided advice for the lenders, Hill Dickinson for Vita Group and Avison Young and Trowers for the Greater Manchester Pension Fund.
