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Harper Macleod's banking team advises City Property on £646m property funding deals

The Banking & Finance team at leading law firm Harper Macleod has advised City Property on a series of three complex funding arrangements totalling £646 million.

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City Property is ultimately controlled by Glasgow City Council, which required the funding to meet its obligations under the equal pay settlement it agreed with members of staff. The three deals saw City Property secure finance of £646 million on a substantial property portfolio of assets located in and around Glasgow, including office, retail and industrial properties. The existing operational use of newly purchased landmark buildings will be retained through leaseback arrangements.

On the announcement of the final agreement, Council leader Susan Aitken said: “I am very pleased to see the conclusion of this process. It is the biggest financial deal concluded in the UK this year. The outcome of it is the payments delivered into the bank accounts of claimants.”

Tony Cameron, Partner and Head of Banking & Finance at Harper Macleod LLP who led the 38-strong project team, said: "We were delighted to assist City Property in reaching deals which work for all parties, not least the 12,000 households in Glasgow which will benefit from the equal pay settlement. This was the final stage in a long-term plan to raise more than £600m by effectively enabling long term loans to be raised based on the value of these landmark assets, while still safeguarding their future use. These have been complex, bespoke deals but ones in which all sides have worked hard to ensure a successful outcome for all."

Harper Macleod's specialist team has extensive experience of advising on complex financing arrangements in the public and private sector.

Commenting on the service provision of Harper Macleod, Pauline Barclay, Managing Director at City Property said: “We are delighted with the support we have received from the team at Harper Macleod who have worked in partnership with us, demonstrating real commitment to the successful conclusion of this key project”.

The most recent deal saw Assured Guaranty announce the completion of a £195m loan package secured by a number of assets including the Riverside Museum, Tollcross International Swimming Centre, Glasgow Royal Concert Hall, Gorbals Leisure Centre and Toryglen Football Centre.

This deal follows two others announced earlier this year. City Property agreed a £166m, 30-year loan facility package with Canada Life Investments secured by three assets - the Emirates Arena and Sir Chris Hoy Velodrome in Glasgow; Scotstoun Stadium and Leisure Campus; and Bellahouston Leisure Centre.

In June, the first deal saw Legal & General arrange finance of £285 million secured on the existing property portfolio of City Property Glasgow (Investments) LLP and the funding of the acquisition of SEC Armadillo, City Halls and Glasgow Museums Resource Centre.