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Blackstone is undertaking two commercial mortgage-backed securitisation deals that will see the private equity giant raise almost £530M of debt secured against student and affordable housing assets.
One of the debt securitisations involves Blackstone raising £275M secured against a portfolio of 1,712 affordable homes owned by Sage, the affordable housing provider of which Blackstone is the majority owner, CoStar reported.
The portfolio was valued at £377M earlier this month, Costar said, meaning the loan-to-value ratio on the deal is 73%. The loan was provided by Deutsche Bank and then sold on to bondholders.
It is the second time Blackstone has securitised debt secured against Sage’s assets. In October last year it raised £220M of debt secured by a portfolio of 1,609 social housing units let to local authority tenants, spread across 113 separate developments. The portfolio was valued at £308M.
Sage has a portfolio valued at more than £700M, company accounts filed earlier this year showed.
The 2020 annual report for Sage said the company had an existing portfolio of 4,007 homes and a pipeline of a further 8,656 homes that it had committed to deliver.
In the other new deal, Bank of America is securitising £250M of debt secured against Blackstone assets, Costar said. This debt is backed by part of Blackstone’s iQ student accommodation business, a 43-asset portion of which was valued at £3.7B in September.
The securitisation gives an insight into the tough 18 months the student accommodation sector has had. When the 2020/2021 academic year started last October, the portfolio’s bookings were 71%. Pre-pandemic, it was 98% occupied.
The portfolio comprises more than 29,000 student beds across the UK.
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