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Pearl Finance 2020: 11 November 2020

The principal source of payment of interest on the Notes and the Issuer Loan, and of repayment of principal on the Notes and the Issuer Loan, will be the right of the Issuer to receive interest, principal and prepayment fees payable under the Senior Loan.

On the Closing Date, the Issuer will use the proceeds of the issuance of the Notes, together with the amount borrowed by the Issuer under the Issuer Loan, to acquire a 100% interest in the Senior Loan pursuant to the Loan Sale Documents. Payments under the Senior Loan due to the Issuer will be allocated to the Notes and will be applied in accordance with the Issuer Priorities of Payments.

The loan is backed by a pan-European portfolio of light industrial and logistics assets managed collectively by Mileway, M7 Real Estate, and Normandie Capital, but owned by Blackstone Real Estate Partners.

The Property Portfolio comprises 61 predominantly last mile logistics assets located across France, Finland, Denmark, Germany, The Netherlands and Ireland. The Properties offer 644,346 sqm of total gross lettable area (GLA) which is currently let to over 350 tenants at an occupancy level of approximately 95%. The Property Portfolio generates €39.1m of gross rental income (GRI), with 82.3% coming from last mile assets located within 20km of major metropolitan areas.

CBRE Loan Services Limited engaged Cushman & Wakefield Debenham Tie Leung Limited to carry out a valuation as a valuer of the Properties as at 31st July 2020. The aggregate market value of the properties was €560.1mln.

EU Risk Retention: Bank of America Europe DAC, as original lender, will retain a material net economic interest of not less than 5% in the securitisation in accordance with the text of Article 6(1) of Regulation (EU) 2017/2402. As at the Closing Date, such retained material net economic interest will comprise not less than 5% of the nominal value of each of the tranches sold or transferred to investors, in the form of the Issuer Loan, which has a nominal value equal to at least 5% of the aggregate Principal Amount Outstanding of the Notes of all Classes and the principal balance of the Issuer Loan in each case, in accordance with the EU Risk Retention Requirement.

US Risk Retention: An economic interest in the credit risk of the securitised assets in this transaction is expected to be retained pursuant to Regulation RR (17 CFR § 246.1 et seq), where Bank of America Europe will act as the "retaining sponsor" and is expected to acquire, on the Closing Date, a "single vertical security" in the Issuer, with an aggregate balance of approximately €16.8mln as of the Closing Date in the form of the Issuer Loan.

Compare/contrast: Arrow CMBS 2018, European Loan Conduit No. 35 (EOS)