Capital & Regional has sold an 80% stake in its £180m Fix trade park portfolio to reduce its level of debt.
The listed co-investing fund manager said that Paradigm and Bank of Scotland Corporate had paid £35m for the 80% stake. It said the sale removed £120m of debt from its balance sheet, although it maintained a 20% exposure to this as a co-investor.
Cap & Reg said cash from the sale would be used to pay down £35m of its core debt facility.
The FIX portfolio is made up of 51 trade parks comprising 276 units over 1.7m sq ft.
New fund
Xavier Pullen, deputy chief executive of Capital & Regional said: 'This new fund offers the potential for greater scale and presence in the market. We look forward to working with Paradigm and the new investors to create a significant business.’
In a note on the company this morning, JP Morgan property analyst Harm Meijer said the biggest danger facing Cap & Reg was high loan-to-value ratios, especially on property held outside its three main Mall, Junction and X-Leisure funds. He said the company’s overall loan-to-value ration was likely to rise from 63% to 67% in 2008, based on the assumption that the company would make £375m of disposals in 2008.
In February Property Week revealed that Capital & Reg was hoping to raise up to £450m through the sale of the Fix portfolio and several centres from its £3bn Mall fund.
