Owners of London’s Olympia Refinancing With $1.7B Loan

Deutsche Bank is going to be at the center of one of the largest refinancing deals in the history of the United Kingdom.

The German lender will provide the massive $1.7 billion loan to refinance London’s Olympia exhibition center redevelopment, Bloomberg reported. The venture is owned by Deutsche Finance International — no affiliation to the bank — and Yoo Capital.

JPMorgan Chase and Evercore arranged the financing, which has not yet been signed.

The loan will refinance and recapitalize the business behind the $2.8 billion overhaul of the historic events venue. The project is scheduled for completion this fall and includes 1.5 million square feet of arts, entertainment and exhibition space plus hotels, bars and restaurants.

The deal signals renewed confidence in London’s commercial real estate market as lenders compete aggressively for major transactions. More than 15 credit providers submitted term sheets, including investment banks, commercial banks and debt funds.

Deutsche Bank’s facility will replace the original $1.16 billion development loan provided by a Goldman Sachs Asset Management fund in 2020. The five-year replacement loan is priced at over 500 basis points and will carry the venture from completion through stabilization.

DFI and Yoo Capital acquired the Olympia venue for $395 million in 2017. The massive redevelopment represents one of London’s most ambitious mixed-use projects in recent years.

A spokesperson for the Olympia venture declined to comment on the transaction. Green Street News first reported the refinancing agreement.

The complex dates back to the 19th century. It hosts a wide variety of international trade and consumer exhibitions, as well as conferences and sporting events. Annual events held there include a horse show, a toy fair and a beer festival.

While this debt is a history maker, the German bank is no stranger to making massive loans. In fact, it may have exposed itself too much in commercial real estate, as a year ago, the bank began gearing up to unburden itself of $1 billion in U.S. commercial property loans from its portfolio in order to clean up its balance sheets.

— Holden Walter-Warner