Aviva Investors has provided an additional £57m in sustainable transition financing to Urban Logistics REIT. The loan is secured against a portfolio of 10 UK logistics assets totalling more than 900,000 sq ft.
The nine-year facility includes a commitment from Urban Logistics REIT to undertake sustainability improvements across the assets being lent against, as well as 23 additional properties from previous tranches of financing that were not sustainability-linked.
The entire lending programme between Aviva and the REIT is now aligned with Aviva Investors’ Sustainable Transition Loans framework, as well as Urban Logistics’ own ESG targets.
Gregor Bamert, head of real estate debt at Aviva Investors, said: “We are happy to extend our lending programme with Urban Logistics through this new loan, but also to have brought everything under our sustainable transition loans framework, showing its commitment to continue enhancing the sustainability credentials of its assets.
“Despite relatively subdued activity in the lending market, this agreement shows that opportunities still exist to invest with established and high-quality borrowers. The REIT market’s asset management capabilities and focus on improving sustainability across its portfolio provides a solid foundation for growing lending activity with this sector.”
Richard Moffitt, CEO of Urban Logistics REIT, added: “In challenging economic times, we focus on our area of expertise: active asset management of single let, last mile logistics. To enable us to do this we have worked with Aviva Investors for a number of years, taking out competitively priced, fixed term debt, reducing the REIT’s exposure to interest rate volatility.
“This refinance allows us to do exactly this, moving the total debt book to an all in cost of 4.2%, 93% hedged or fixed to term, while the sustainability link further embeds our ESG targets across the business.”
