The Board of Empiric Student Property plc is pleased to announce that the Group has agreed a new loan facility (the "Facility") of £32.8 million with AIB Group (UK) PLC ("Allied Irish Bank").  The Facility is secured against a portfolio of five forward funded assets, held as a lending group through a wholly owned subsidiary, Empiric Investments (Six) Limited.

The Facility is a development loan which will be drawn down in agreed stages over the development period with practical completion of all five forward funded assets expected by July 2017.  The Facility will convert into an investment loan providing that, inter alia, the developments have reached practical completion.

The Facility is available to draw down in full, subject to the fulfilment of certain conditions precedent, until 15 October 2017. The development loan must be repaid on the earlier of (a) the date on which the five developments achieve practical completion and (b) 29 December 2017. The investment loan must be repaid in full by 31 October 2018.

The interest rate in respect of the development loan is at a margin of 2.80 per cent. per annum over LIBOR and in respect of the investment loan is at a margin of 1.80 per cent. per annum over LIBOR.

The amounts drawn down under the Facility will be segregated and non-recourse to the Company.  In accordance with the Company's investment policy, the Company will maintain a conservative level of aggregate borrowings, targeting a level of 35 per cent. but no more than 40 per cent. of the gross asset value of the Company (calculated at the time of draw down). 

Strategic advice on the structure and assistance in arranging the debt was provided by J C Rathbone Associates.

Paul Hadaway, Chief Executive of Empiric Student Property plc, commented:

"We are very pleased to have secured this debt facility with Allied Irish Bank which demonstrates that, even in volatile markets, funding at highly competitive pricing is available for companies, such as Empiric, with a solid business model.  The Facility will help to maximise the Group's development potential by recycling equity currently committed to our forward funded developments. The Allied Irish Bank team has been enthusiastic and supportive, and we believe that this new relationship bodes well for the future."