Saturday 20 July 2019

REO unlikely to make loan deadline next week


Emmet Oliver

Real Estate Opportunities (REO), the property firm majority controlled by Treasury Holdings, is not expected to have a deal to fund Battersea power station agreed in time to avoid missing a £260m (€293m) debt payment.

The repayment of a loan from Lloyds Banking Group and NAMA has been extended until this Wednesday, but after that it becomes due. REO is hoping to attract a funder for Battersea and consequently persuade lenders to put in place a new debt package.

But the Irish Independent understands any deal won't be in place on Battersea by Wednesday and the company will have to make a statement to the stock exchange. The precise response of lenders at that point is not known.

The loan can be called in at anytime, but REO believes lenders are in support of the company's plans and have no plans to take enforcement action. Ernst & Young are advising the lenders on the talks.

British Land and Blackstone are reported to have expressed an interest in Battersea, but so far no parties have signed up. REO have got planning permission to develop the iconic site, but still need a London Underground connection.

The company's UK team are leading the negotiations, but pressure is on REO to put in place new funding. The company also wants to remain the development manager of the site, but it is unlikely any new investor would give up management control of such a large project, some sources said.

Irish Independent

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