Investec arranges £72m loan to fund residential and co-working development in King’s Cross

By Bridging Loan Directory 21st May 2018

Investec Structured Property Finance (“Investec”) announces that it has provided The LabTech Group, the Digital and Real Estate Development and Investment business owned by Israeli billionaire Teddy Sagi, with a £72mn loan to fund the development of a major 140,000 sq ft mixed-use scheme in King’s Cross, London.

Alongside Investec’s £43mn commitment, £29mn of debt has been arranged with Bank HaPoalim, Israel’s largest bank, as Investec continues to structure club deals and leverage other balance sheets for the benefit of its clients.

This year, Investec has already arranged over £400mn of development finance, across projects that will deliver 1,150+ new units, demonstrating its ongoing commitment to support its clients with innovative solutions.

This scheme is located on Camley Street, adjacent to King’s Cross Central, Europe’s largest regeneration project, where planning consent has been granted to develop 121 one, two and three-bed luxury apartments and 29,000 sq ft of co-working space. The apartments will be let and operated by LABS LIVE, and the flexible office space will be provided under the LABS co-working platform. LABS LIVE and LABS are Sagi’s respective PRS and co-working platforms and this transaction represents the first scheme where they will come together to offer customers a residential and working solution. Initial works have commenced on the scheme and practical completion is expected in 2020.

King’s Cross Central’s appeal as one of London’s most desirable creative hubs has seen the arrival of major occupiers including Google, YouTube, and Louis Vuitton, alongside the University of the Arts, Central Saint Martins Campus. It benefits from its close proximity to St Pancras International national rail, the Eurostar and several tube lines.

Last month, Investec raised £195m for the Cain International led consortium the Stage Shoreditch LLP to fund development the Stage, the 550k sq ft mixed use scheme in Shoreditch with an anticipated GDV of £750m. The funds raised were part of a £390mn club with 5 lenders where Investec provided a £97.5m commitment of its own alongside arranging £97.5m from Harel, the Israeli insurance group. Lloyds acted as co-ordinator of the facility.

Investec has a long-standing relationship with the Stage Shoreditch LLP, having funded the 2.3 acre site acquisition in 2015 with a £105mmn loan and are an investor in the scheme.

Simon Brooks, co-head of origination at Investec, commented;

“We’ve been working hard to build strategic partnerships with like-minded lenders so that we can support our clients beyond the scope of our own balance sheet. 101 Camley Street and The Stage represent two substantial transactions being pursued by leading entrepreneurs. We are glad that with the relationships we have built with other lenders such as Bank HaPoalim and Harel, we have been able to build on our capability and support our clients.”

Joshua Weinstein, at Investec, who ran the transaction, added;

“With a track record of supporting entrepreneurs in adding and creating value through the delivery of high-quality schemes in prime locations, we look forward to building a long-lasting working relationship with Teddy Sagi and supporting the growth of his diverse real estate portfolio. 101 Camley will be a pioneering scheme, offering LABS customers a diverse range of services across the spectrum of co-working and living needs. We are excited about being a part of this endeavour, and assisting our client in expanding these platforms.”

Chen Moravksy, President and CEO of The LabTech Group, commented:

“This is a very exciting project for The LabTech Group, creating another valuable LABS ecosystem for co-working, living and events. We are delighted to be working with Investec on this project and look forward to a long and beneficial relationship.”