CEG secures £72.9m loan agreement to help fund major city office development
Aviva Investors, the global asset management business of Aviva plc, has signed a £72.9m sustainable transition loan agreement with Commercial Estates Group, the property investment management and development company.
The senior debt facility forms part of Aviva Investors’ commitment to originating £1bn in sustainable transition real estate debt over the next four years following the launch of its proprietary Sustainable Transition Loans Framework in December last year.
While CEG will use the loan proceeds to refinance a portfolio of six regional office assets, a portion of it will part-fund the development of Globe Point, a 37,842 sq ft Grade A office in the Temple area of Leeds, which forms the first part of a £350m project by CEG.
The seven-storey building will deliver office space with ground floor break-out space, a café, and will aim to achieve a BREEAM excellent and EPC A rating.
The six regional office assets are located in strongly performing markets such as Liverpool and Bristol, and feature a mix of over 100 tenants.
Gregor Bamert, head of real estate debt at Aviva Investors, said: “We are pleased to have an opportunity to work with CEG through the provision of this sustainability linked loan, following active discussions over a number of years.
“CEG have a stated commitment to sustainability and improving the green credentials of its portfolio, which both parties were keen to incorporate into the loan.
“It is also pleasing to be able to fund the development of a new high-quality asset such as Globe Point.
“Despite short-term headwinds in the local office market, we are confident this portfolio will perform strongly given CEG’s active management capability and the quality of buildings it produces.”
Gerard Versteegh, chairman of CEG, added: “We are delighted to be working with Aviva Investors as a strategic partner.
“We expect this will lead to a long, fruitful collaboration on many more projects to come. Our approach to sustainability is ambitious and embedded into everything we do. We continue to push the innovation boundaries to ensure well-being, technology and sustainability are at the heart of Globe Point.”