The owners of Atria Watford announced this week that a new financial restructuring plan has been agreed for the mall.
SGS also revealed that the restructuring allows new financing to support further investments in its four shopping centers, including Watford.
Steve Gray, head of retail asset management in Europe at Global Mutual – the company that took over the mall last year – described the news as a “defining moment.”
He said he was “proud” that his team was able to deliver during the transition period and said that with the new funding certainty and the “stable” capital structure, SGS can now focus on achieving its three-year business plan.
Find out more: Atria Watford owners post update on mall’s future
But what is the agreed financial restructuring? SGS says the terms and conditions have been agreed with all of its forward charge providers and noteholders (those who loaned the money) and that there are three key goals of the long-term restructuring.
This includes establishing a “stable” capital structure; a mixture of various external financings, called capitals, used to finance a business.
This will be facilitated by extending the repayment date of the bank term loan until March 2024, with a further extension until December 2024 if certain milestones are reached.
The original notional will remain in place and all interest will be paid on a “pay if you can” basis. Any interest not paid in cash will be capitalized and added to the debt balance.
Stakeholder interests will be aligned and there will be a set of security on a pari passu principle – meaning that all unsecured creditors in insolvency processes must equally share all available assets of the company or company. the individual, or any proceeds from the sale of any of these assets. , in proportion to the debts owed to each creditor.
Meanwhile, terms have also been agreed on a new “super senior finance facility”.
According to SGS, this will ensure that the business plan is fully funded. The facility is provided on a back stop basis and all term lenders and noteholders will be offered the opportunity to subscribe to the facility.
Mr. Gray said: “The agreement on long-term financial restructuring and new financing with our lenders is a defining moment for our four shopping centers. [Watford, Lakeside, Victoria Centre – Nottingham, and Braehead]. With the certainty of funding and a stable capital structure, we can now focus on delivering our three-year business plan and exit strategy with renewed confidence.
“I am also very pleased to report a strong operational performance in our centers despite the sustained headwinds caused by Covid-19, with further improvements expected as restrictions ease further over the coming weeks.
“Despite the transition to new ownership and management in the midst of a global pandemic – which has undoubtedly posed the biggest challenge for our industry in recent times – I am proud to say that we have achieved what we have. were only set to do a few months. ”
Last summer, the future of the Watford shopping center was uncertain after its former owners – intu Properties – fell under administration.
The transfer of management of the center from Intu to Global Mutual and Savills was completed late last year, with the center being renamed Atria Watford in March 2021.