Segro Regulatory News (SGRO)

04 September 2014

SEGRO European Logistics Partnership completes €208 million of additional bank funding

SEGRO plc ('SEGRO'), Europe's leading owner, asset manager and developer of industrial and warehouse property, is pleased to announce that it has arranged €208 million of bank funding for SEGRO European Logistics Partnership ('SELP'), in which SEGRO owns a 50 per cent interest.

The additional funding supports the acquisition of €472 million of prime logistics assets in Germany, Poland and France. This acquisition, the final element of which was completed on 30 June 2014, is consistent with SEGRO's objective to increase its exposure to the Continental European logistics market in conjunction with third party capital.

The debt is structured within three separate secured bank facilities (the last of which has been recently finalised) as follows:

1) A new 5 year €139 million German debt facility with pbb Deutsche Pfandbriefbank and Helaba as lenders. This facility comprises €114 million of drawn term debt and €25 million of undrawn facilities to be utilised in connection with future development projects;

2) €41 million of term debt as an increase to the €188 million five year SELP debt facility (also with pbb Deutsche Pfandbriefbank and Helaba as lenders) put in place in October 2013 in respect of SELP assets in Poland and the Czech Republic; and,

3) €28 million of term debt as an increase to the €140 million seven year SELP French debt facility arranged in October 2013 with Aareal Bank.

The newly outstanding debt provides a weighted average loan to value ratio of around 39 per cent on the portfolio acquisition value and is structured as fixed rate loans with a weighted average blended margin of 1.6 per cent and a weighted average blended total cost (excluding amortisation of up-front fees) of 2.2 per cent p.a. over the life of the facilities.

Commenting on these transactions, Justin Read, SEGRO Group Finance Director, said:

"We are very pleased to have had the opportunity to work with the existing SELP lending banks to put in place such cost effective debt funding for our recent portfolio acquisition.

These financings are consistent with SELP's funding objective to enhance returns through low cost debt whilst maintaining a moderate level of financial leverage."

END

Contact:

Justin Read, Group Finance Director Tel: +44 (0)20 7451 9110

Lizzie Humphreys, External Communications Manager Tel: +44 (0)20 7451 9129

Stephanie Highett / Nick Taylor, FTI Consulting Tel: +44 (0)20 3727 1000

About SEGRO and SEGRO European Logistics Partnership ('SELP'):

SEGRO is a leading owner, asset manager and developer of modern warehousing and light industrial properties, with £4.5 billion of assets (at 30 June 2014, including joint ventures at share) principally concentrated in London's Western Corridor (including the Thames Valley) and in key conurbations in France, Germany and Poland. It also develops and owns warehouses in important distribution markets in the UK, Belgium, the Netherlands and the Czech Republic, and offices in Slough and Milan. The Group serves around 1,250 customers spread across a diverse range of industry sectors. It has 5.8 million square metres of built space under management and a gross passing rent roll of £266 million (SEGRO share). 

SEGRO European Logistics Partnership ('SELP') is a joint venture in which SEGRO owns a 50 per cent interest. It was established in October 2013 and has €1.6 billion of assets under management (as at 30 June 2014) across six Continental European countries. SEGRO acts as asset, property and development manager for the joint venture.

For further information see www.SEGRO.com/investors.