Arranged a competitive staple financing package to help market the asset on behalf of the seller (Aermont Capital) who were faced with difficulties due to the principal tenant being WeWork. Subsequently appointed by the purchaser (Hana Financial) as debt advisor, to arrange the acquisition facility sourced as part of the staple financing.
Aermont Capital were marketing the sale of One Poultry, an iconic listed asset in the heart of the City of London. WeWork had leased 100% of the fully refurbished office space as their flagship location in the City and the building also contained the Coq d’Argent restaurant, various retail operators and a new Puttshack mini-golf centre in the basement. The seller faced difficulties finding a buyer due to the lack of debt availability from potential lenders, driven by the vast majority of the income being derived from WeWork’s occupation of the building. The seller engaged Brookland to arrange a competitive staple financing package to help with the sale of the asset, with the intention that Brookland would then arrange the debt for the successful bidder.
- We approached 60+ potential lenders across the UK & Continental Europe in order to successfully arrange the staple financing. The staple financing terms secured were pivotal in the seller’s marketing process. Brookland subsequently, with the approval of the seller, executed the staple financing package on behalf of the successful bidder, Hana Financial.
- Many lenders had reached their exposure limits on WeWork or were unable to get comfortable with the strength of the WeWork covenant. Our approach was to underwrite the asset itself on an operational basis, as if it were occupied by a generic co-working operator, rather than focussing on the WeWork covenant. To give potential lenders comfort around the strength of the asset as a co-working location we undertook an in-depth analysis of the tenant’s underwritten business plan as well as the pre-lets and desk/room rates that had been agreed to date. This operating analysis coupled with the strength of the asset (in particular its location) which gave a relatively high vacant possession value drove the underlying lender underwriting.
- We added significant value by securing competitive debt terms from new pockets of capital without any existing exposure to WeWork. In addition we worked with all the key stakeholders, due diligence providers and lawyers and project managed the entire transaction to ensure it completed smoothly, at a time of significant political and market volatility in the UK due to Brexit concerns.