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Northern Ireland Investment Fund makes debut senior loan to re-develop Belfast’s Merchant Square

By James Wallace - Wednesday, May 09, 2018 11:08

The £100m Northern Ireland Investment Fund, which is managed by CBRE’s Capital Advisors, has extended a £20m senior debt facility to Oakland (FRO) Limited to fund the re-development of Merchant Square in Central Belfast.

The £100m Northern Ireland Investment Fund was launched in November last year to provide debt finance for real estate, regeneration, low carbon and infrastructure projects and is managed on behalf of the Department of Finance and the Northern Ireland Strategic Investment Board.

This first loan will finance the first speculative office scheme of its size and quality for several years in Belfast and will, in turn, provide a gateway for Oakland to unlock further private sector funding. The funding will finance the re-development and extension of existing offices in Belfast to provide 202,740 sq ft of high quality Grade A office accommodation with a ground floor retail element.

The Merchant Square scheme is located in a prominent location within the central business district. The fund’s loan will match the existing mezzanine debt and equity behind the scheme pound for pound.

Andrew Antoniades, senior director, CBRE Investment Advisory, said: “We are excited to be getting the Fund off to a fantastic start, well ahead of forecast. Making such a significant investment is a statement showing what the Fund is about - supporting regional growth whilst delivering exceptional leverage, outputs and returns for the Fund. We are well progressed with other exciting schemes within and outside Belfast and remain very much open for more applications.

Hugh Widdis, permanent secretary, Northern Ireland Department of Finance, added: “Today’s announcement of the Merchant Square development sees the first project investment from the £100m Northern Ireland Investment Fund. This first project loan demonstrates the Northern Ireland Investment Fund’s positive impact and future potential in terms of facilitating private sector-led regeneration here. I look forward to further announcements in the time ahead on project loans being confirmed to stimulate additional economic growth and jobs”.

The Northern Ireland Department of Finance has allocated £100m to the CBRE managed fund, which is obliged to deliver at least an equivalent level of private sector leverage. One investment cycle alone, therefore, will support at least £200m of investment in the local economy and it is expected that CBRE to deliver more than one investment cycle over the life of the fund, implying a minimum total total investment of at least £400m.

James Wallace is a freelance consultant and can be reached via Linkedin or email: jawallace32@gmail.com

 

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