£42.7m loan secured against tallest office building in Leeds

A £42.7m loan has been secured against The Pinnacle building in Leeds, which was purchased for £65m by a Brockton Capital fund.

Now, Barings Real Estate, part of Barings LLC, a real estate investment manager, has provided, on behalf of an institutional investor, its first floating rate senior debt facility with a £42.7m loan secured against the building – which is the city’s tallest office tower.

The property was acquired by a fund advised by Brockton Capital in April 2018. The three-year facility represents a loan to value of 65%.

The Pinnacle is a 145,000 sq ft, 19-storey mixed use property comprising 15 retail and leisure units on the lower levels, a 388-space multi-storey car park and 75,000 sq ft of office accommodation on the upper floors.  The property is occupied by 27 tenants with a weighted average unexpired lease term to break of 11.9 years.

Chris Bates, head of real estate core mortgage Europe at Barings, said: “As our first floating rate senior loan transaction, the financing of The Pinnacle is an important milestone in the diversification and growth of our lending business in Europe, which now encompasses fixed and floating rate facilities, structured and senior debt, as well as development finance.

“The Pinnacle is one of Leeds’ most iconic buildings with an excellent location, for which Brockton Capital has a clear active asset management strategy.”

James Spencer, principal at Brockton Capital LLP, said: “We are delighted to be working with Barings Real Estate who shares our vision to revitalise significant and improving destinations in major regional cities.”