Belfast’s newest commercial property development Merchant Square was handed over to PwC at the end of June, and developer Oakland Holdings has signed off on a major refinancing of the building. Construction started on Merchant Square in 2018, and the 10 floor building which provides 230,000 sq ft of Grade A office space was funded through a combination of Oakland Holding’s own investment, and loans from Fairfield Real Estate and the Northern Ireland Investment Fund.
The Northern Ireland Investment fund was established in 2017 and is managed by CBRE UK. Merchant Square was NIIF’s first investment.
Will Church, Senior Director, CBRE Capital Advisors, commented: “We are delighted by the early repayment of the Fund’s first loan. Acceleration of this type of development in a market short of funding options is exactly what the Northern Ireland Investment Fund was created for. The ability for occupiers to see sites under development before committing to taking space is critical in completing the funding circle. The location of 3,000 jobs in Belfast by PwC and the early refinance by Danske Bank have been made possible by Oakland’s development skills coupled with NIIF’s funding provision.”
PwC will centralise their Northern Ireland operation in Merchant Square which will house 3,000 employees when fully occupied. With long-established credentials in the technology sector, PwC’s Merchant Square base will be one of the city’s most innovative digital spaces. As well as being the firm’s global hub for blockchain, and PwC Research, the firm will also relocate the Google Innovation Lab which currently sits within the firm’s existing base in Waterfront Plaza.
The refinancing of the Merchant Square development was overseen by Radius Corporate Finance. Brian Loughan, Director of Radius Corporate Finance, noted: “ After we managed a 6 month long competitive process involving over 60 possible lenders, early in 2020 Danske Bank was selected to be funder for the refinance. We worked with Danske to deliver a very competitive and well-structured proposition which has provided for the redemption of existing funders. This refinance helps bookend a very successful project by Oakland Holdings, and is indicative of the calibre of projects that Oakland Holdings will seek to continue with in the years ahead.”
Geoff Sharpe, Head of Corporate at Danske Bank, said: “Merchant Square is the largest property transaction in the local market for some time. The investment in upgrading Merchant Square and PwC’s decision to relocate its regional headquarters is a strong demonstration of confidence in the city centre. Alongside other ongoing developments, such as the Transport Hub, it will play a big part in the continued growth and appeal of central Belfast as an attractive location for business. We were delighted to be appointed as the funder and to play our part in the completion of this landmark project.”
Adam Dickson, Finance Director of Oakland Holdings welcomed the re finance.
“In spite of the ongoing Covid-19 crisis, and the difficult economic circumstances, we handed over Merchant Square at the end of June. This is the most significant speculative development ever undertaken in Belfast and has led to the largest private sector letting in the region at over £20.00 per sq ft. We have replaced the old 1960’s style commercial buildings that were previously on this site and now we have a shining example of what Belfast can achieve when we are ambitious and brave in our decision making.
“Merchant Square is a lead project in the emergence of a new Belfast. The re-financing of the development means that we can look ahead to new and further expansions in Belfast and across these islands.”
The legal advisors for the Oakland Group were A&L Goodbody, whilst Danske Bank were advised by Millar McCall Wylie.