C.H.M.T. Peaceful Development Asia Property Ltd. is looking to obtain a mezzanine loan and a senior loan to fund up to 90% of its US$5.2 billion deal to acquire the 73-story The Center office tower in Hong Kong from CK Asset Holdings Ltd., Reuters reported, citing a term sheet and people familiar with the matter.
Four people, three of whom were bankers engaged in the transaction, told Reuters that C.H.M.T. plans to fund as much as 50% of the purchase price with a senior loan, while a term sheet from the company showed it is seeking a one-year mezzanine loan with an 8% interest rate to fund about 40% of the deal value. The mezzanine loan will potentially be provided by a consortium of fund houses and is expected to be finalized by March 2018, according to the term sheet.
The planned sale of the building is expected to generate a HK$14.5 billion gain and is said to be on track to be the largest single-property divestment worldwide.
C.H.M.T., which is owned by China Energy Reserve, Chemicals Group Properties Ltd. and a few Hong Kong investors, was not immediately available to comment on the matter, according to Reuters.
