Extra MSA Group has completed a £220m private bond issue on one of its portfolios containing nine Motorway Service Area (MSA) assets.
The Abraham portfolio has a current total annual net rental income of around £23m and includes Extra’s M40 Beaconsfield and M25 Cobham MSAs, two of the newest and busiest Service Areas in the UK.
Extra is majority owned by Evergreen, an investment partnership managed by London-based M3 Capital Partners. It owns 18 MSAs with its Ulysses Portfolio also containing nine property assets. The Abraham portfolio comprises seven MSAs operating under the ‘Extra’ brand along with two pairs of separate MSA filling stations let to Shell and BP.
The bond issue has a 10-year term with a fixed annual coupon of less than 3.7%. The proceeds have been used by Extra to refinance existing bank funding, return funds to the equity holders and support further growth of the business.
Through real estate investment manager Aalto Invest, the bonds have been placed with a consortium of long-term institutional investors comprising Rothesay Life, Dongbu Insurance and Dongbu Asset Management, together with one other substantial UK institution. Aalto Invest will additionally act as loan manager for the term of the Bonds.
Andrew Long, chief executive Office of Extra said: “The calibre of the three global investors underlines both the quality of Extra’s property assets and its tenant-base, as well as Extra’s ability to proactively manage a secure income stream in this specialist sector, with further ongoing long-term income growth potential.”
RBS Private Placements acted on behalf of Extra. Aalto Invest acted on behalf of the three Investors. Colliers International provided valuation advice to the investors.