- OakNorth has provided a £25m facility to ICG-Longbow Senior Secured UK Property Debt Investments Limited (LBOW) – the London Stock Exchange-listed fund specialising in first mortgage property investment loans secured against UK commercial real estate;
- LBOW has a market capitalisation in excess of £125m. LBOW’s Investment Adviser, ICG-Longbow, is the real estate division of Intermediate Capital Group plc, a specialist asset manager with a 29-year track record of investment in private debt, credit and equity, with approximately €32.9 billion assets under management;
- After an extensive search, LBOW opted for OakNorth, appreciating the speed and transparency with which the challenger operates.
OakNorth the bank for entrepreneurs has completed a fund finance deal of £25m with ICG-Longbow Senior Secured UK Property Debt Investments (LBOW), the London Stock Exchange-listed fund.
LBOW’s objective is to construct a portfolio of UK real estate debt related investments, predominantly comprising loans secured by first ranking fixed charges against commercial property investments. LBOW’s aim is to provide shareholders with attractive, quarterly dividends, capital preservation and, over the longer term, a degree of capital appreciation. Since becoming fully invested in 2014, LBOW has consistently delivered a 6p per annum annual dividend to shareholders, and has not experienced any loan defaults.
Jack Perry, Chairman of LBOW, said: “We are delighted to be partnering with OakNorth on this loan facility; they have provided a tailored solution which will support the investment in new loan opportunities to meet our business needs, while executing the transaction in the timeframe we required. They have a demonstrable understanding of the needs of fund investors, and, with property comprising a significant portion of their own lending portfolio; have a deep understanding of the underlying asset class.”
In a joint statement, Ben Barbanel, Head of Debt Finance, and Mohith Sondhi, Debt Finance Director at OakNorth, commented: “LBOW is a well-established fund with an excellent track record. The Investment Adviser’s team, who average 24 years’ experience in property, financing or investment management, have helped LBOW consistently deliver sustainable returns for shareholders at one of the highest yields in the sector.
“This transaction demonstrates the breadth of OakNorth’s offering and the spectrum of deals we’re doing – everything from £500k transactions with owner-managed businesses to double-digit loans with established SMEs, and complex deals such as this one with listed companies. Given LBOW’s track record, they have the pick of the litter when it comes to borrowing. However, despite being a competitive process, we were able to distinguish ourselves through our transparent and speedy process and are delighted to have been selected by the team to take this transaction forward.”