21. Financial liabilities

The financial liabilities can be specified as follows:

 

Term facilities

Mortgage

Bonds

Private placements

Total

As at 1 January 2017

360

75

596

200

1,231

Drawn

382

-

-

100

482

Discount

-

-

1

-

1

Repayments

(467)

(75)

-

-

(542)

Financing costs

-

-

(1)

-

(1)

Amortisation

-

-

1

-

1

As at 31 December 2017

275

-

597

300

1,172

      

Drawn

827

-

500

-

1,327

Discount

-

-

-

-

-

Repayments

(758)

-

-

-

(758)

Reclass to Current liabilities

-

-

(300)

-

(300)

Financing costs

(2)

-

(2)

-

(4)

Amortisation

1

-

1

-

2

As at 31 December 2018

343

-

796

300

1,439

Debt funding

The information below is provided for explanatory purposes with regard to the Vesteda Companies’ long-term funding.

The Vesteda Companies obtain their debt funding through various sources:

  1. Bank facilities, comprising corporate unsecured bank funding provided by banks, and senior unsecured notes issued under private placement transactions sourced via Vesteda Finance B.V.

  2. Bonds, issued by Vesteda Finance B.V. under the EMTN programme.

  3. Private Placements under the EMTN programme as well bi-lateral agreements placed by Vesteda Finance.

In 2017, Vesteda Residential Fund FGR discontinued its mortgage borrowing under existing financing arrangements and no longer provides Investment Property as collateral for its debt funding.

1) Bank facilities

Corporate unsecured funding

Vesteda Finance B.V. acts as borrower and issuer of all corporate unsecured debt on behalf of Vesteda Residential Fund FGR. As per 31 December 2018, Custodian Vesteda Fund I B.V., Custodian Vesteda Fund III B.V. and Custodian Vesteda Fund IV B.V. act as guarantors for all obligations of the corporate unsecured debt that is borrowed or issued by Vesteda Finance B.V.:

  • In 2018 the existing 600-million revolving credit facility was amended and extended. The facility size increased by €100m to €700 m and is funded on 1-Month and 3-Months Euribor. The facility has a 5-year initial term plus two 1-year extension options and is provided by the lenders ABN Amro, Rabobank, BNP Paribas, Deutsche Bank, ING and SMBC. The remaining legal term is 4.4 years. At year-end 2018, of the total facility of €700 million an amount of €155 million was outstanding and an amount of €545 million had not been drawn.
    Pricing of the revolving credit facility is subject to a margin grid, whereby an LTV below 27.5% equates to a margin of 0.50%. Utilised commitment less than 33.3% equates to a utilisation fee of 0.10%, and utilised commitments exceeding 33.3% but less or equal to 66.7% equate to a utilisation fee of 0.20%. Utilised commitments exceeding 66.7% equate to a utilisation fee of 0.40%.

  • In 2018 Vesteda arranged an €200 million revolving credit facility with Sumitomo Mitsui Banking Corporation (SMBC). The facility is funded on Euribor for the relevant interest period and has an initial end date of August 2019 plus an option to extend until December 2020. The remaining legal term is 1.9 years. At year-end 2018 of the total facility of € 200 million an amount of €191 million was outstanding and an amount of €9 million had not been drawn.

  • Pricing of the SMBC revolving facility is subject to a margin grid whereby an LTV below 27.5% equates to a margin of 0.45% and no utilisation fee.

2) Bonds

In 2018, Vesteda Finance B.V. continued its borrowing of senior unsecured notes that were issued under its programme for the issuance of Euro Medium Term Notes (EMTN). Standard & Poor’s rated the notes BBB at the time of issuance. The credit rating of the notes was upgraded to BBB+ in 2016, in line Standard & Poor’s credit rating upgrade of Vesteda Residential Fund:

  • A first tranche of €300 million senior unsecured notes was issued in July 2014. The notes pay an annual fixed coupon of 1.75% and are due on 22 July 2019. The intended remaining term to maturity of the notes is 0.6 years;

  • A second tranche of €300 million senior unsecured notes was issued in October 2015. The notes pay an annual fixed coupon of 2.50% and are due on 27 October 2022. The intended remaining term to maturity of the notes is 3.8 years.

In July 2018, Vesteda Finance B.V. issued an additional €500 million in senior unsecured notes. The notes pay an annual fixed coupon of 2.00% and are due on 10 July 2026. The intended remaining term to maturity of the notes is 7.5 years.

Private Placements

A €100 million private placement borrowing with funds provided by PRICOA Capital Group under a note purchase agreement. The senior notes have a fixed annual coupon of 3.18%, payable on a semi-annual basis and are due on 8 May 2021. The intended remaining term to maturity of the notes is 2.4 years.

A second €100 million private placement borrowing with funds provided by PRICOA Capital Group under a note purchase agreement. The senior notes have a fixed annual coupon of 1.80%, payable on a semi-annual basis and are due on 16 December 2026. The intended remaining term to maturity of the notes is 8.0 years.

In December 2017, Vesteda Finance B.V. issued an additional €100 million in senior unsecured notes under its programme for the issuance of Euro Medium Term Notes (EMTN) as a private placement transaction. Standard & Poor’s rated notes BBB+ at the time of issuance:

    • A tranche of €35 million senior unsecured notes pay an annual fixed coupon of 1.899% and are due on 15 December 2027. The intended remaining term to maturity of the notes is 9.0 years;

    • A tranche of €65 million senior unsecured notes pay an annual fixed coupon of 2.478% and are due on 15 December 2032. The intended remaining term to maturity of the notes is 14.0 years.