CTP to Receive $2B for Czech Industrial Portfolio Refi

Czech developer CTP has reached an agreement with multiple lenders, marking the largest real estate transaction in Central and Eastern Europe this year.
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A consortium of three banking groups has agreed to provide a package of seven-year loans totaling €1.9 billion ($2.2 billion), which will allow Prague-based developer CTP to refinance its Czech industrial portfolio.

The deal reportedly is the largest CRE transaction in Central and Eastern Europe so far in 2019; it will consolidate 40 existing loan agreements into one syndicated loan. The portfolio consists of 200 buildings totaling 2.7 million square meters (29 million square feet) of industrial space. Of the total loan package, €1.6 billion ($1.8 billion) will refinance existing properties and €269 million ($306 million) is new financing for projects to be completed in the next 18 months.

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In a prepared statement, Zdeněk Raus, CTP’s CFO for the Czech Republic, said the new loan structure would significantly simplify the company’s previous financing arrangements and streamline loan administration.

CTP is a CRE developer and manager, as well as the owner of the CTPark Network, reportedly the largest integrated system of premium business parks in Central and Eastern Europe, with more than 5 million square meters (54 million square feet) of Class A properties at more than 90 locations in eight countries.

The three banking groups were Erste Group and Česká spořitelna; UniCredit S.p.A. and UniCredit Bank Czech Republic and Slovakia, a.s.; and Société Générale and Komerční banka. The security agent was Deutsche Pfandbriefbank AG, while Clifford Chance Prague LLP and Eastdil Secured advised CTP in the transaction. The underwriting banks were advised by White & Case s.r.o. (legal services), KPMG Česká Republika s.r.o. (tax/financial), Arcadis Czech Republic s.r.o. (technical advisors) and CBRE s.r.o. and JLL s.r.o. (valuation).

As of press time, CTP had not responded to Commercial Property Executive’s request for additional information.

Investment volume snapshot

Commercial real estate investment volume in the CEE region was about 21 percent lower in the first quarter than the record set a year prior, according to a first-quarter report from Colliers International. So far, the report states, “2019 figures are trending more closely to volumes seen in 2015 and 2016.”

Deal flow in the Czech Republic has increased to quarterly rates seen in 2016 and 2017. Western European funds were net buyers in the first quarter, while U.S. and U.K. funds remained net sellers, and East Asians were still active buyers, again per Colliers.