NatWest arranges and coordinates a £105m loan for Scape Living plc
NatWest and Virgin Money have backed a new student residence in Hammersmith at 181 Talgarth Road, which is currently under development through a forward funding agreement between Scape Living Plc and Dominus Group.
The project will offer 713 beds a short walk away from Hammersmith Broadway station. The Hammersmith student accommodation site is accessible to a wide range of universities including Imperial College London, University of Roehampton and Kings College London’s Strand Campus, as well as several local Higher Education Institutions.
In order to combat increasing rent prices in London, Scape are intending to let 357 of the 713 rooms under a nominations agreement with a London University at an affordable rate which is capped by the Mayor of London. This will make living in London more accessible for more students. The remaining rooms will be let privately.
The residence will offer a wide range of amenities including workspace and meeting rooms, a cinema, communal kitchens, a gym, roof terrace and bike storage. The building is targeting completion in June 2025, ready for the start of the 2025/26 academic year in September.
Scape Living Plc is one part of the of the global Scape brand which has over 30,000 beds under operation and in development across the UK, USA, Australia and Ireland. In 2020, Scape entered into a £500m joint venture with APG Asset Management to deliver purpose-built student accommodation and Living assets across the UK, where both parties will be deploying significant capital over a number of projects. Scape will also be operator of the assets once built.
Following a request for development financing by Scape earlier this year, NatWest agreed a £105m 3 year funding solution to finance the development of the residence. NatWest credit back-stopped the full amount, however in order to manage financing capacity to support Scape with future opportunities, NatWest was also appointed debt coordinator and sought third-party liquidity pre-transaction close. Virgin Money was mandated due to their experience in the sector and confidence in the transaction, agreeing to provide £52.5m and leaving NatWest with the remaining half, equating to a hold level of £52.5m.
Harry Daws, investment director at Scape Living plc, said: “Scape Hammersmith is a continuation of Scape’s journey to provide best-in-class student accommodation and will help to address the significant shortage of high-quality PBSA developments in London. We are thrilled to have partnered with NatWest to deliver this scheme as we continue to build out our significant pipeline of developments across the UK.”
Eirini Kalamara, relationship director at NatWest, added: “NatWest has a long history of supporting the student residential market and we are proud to be playing our part in providing high quality housing within touching distance of many London universities and colleges. We are thrilled to commence our relationship with Scape Living with this student accommodation development loan.”
DWF, CBRE and Gardiner & Theobald provided advice for the lenders, and Simmons & Simmons and Mayer Brown for Scape.
