Canary Wharf Group Plc, the London-based office space construction company, recently inked a £1 billion credit to bulk up for GBP 4.1 billion in capital expenditures. Peter Anderson, managing director of finance, said the company needed to raise capital to fund costs associated with the building of office space in London. The office space is positioned as an alternative to the overcrowded London financial district.
The deal is structured as a three-year revolver and a four-year term loan. Pricing on both pieces is LIBOR plus 1%.
Anderson said the company chose EuroHypo Bank, HSBC, HVB Real Estate Capital, and Royal Bank of Scotland to lead the facility as these banks have experience in the construction market. "We needed banks that could write significant amounts and have the expertise to manage a construction loan," he said. Anderson explained that each bank committed to £250 million of the facility and the company paid roughly 370 basis points in fees.