Finance for bank HQ
Funding secured for Glasgow’s biggest office development
New home: Cydesdale Bank will move to Bothwell St
Clydesdale Bank’s new head office building in Glasgow has secured a loan deal to make progress on the development.
HFD Property Group (HFD) has agreed an £88.9m development loan through the Bank of Scotland Real Estate and Housing team’s Green Lending Initiative for 177 Bothwell Street.
The four-year funding package provides the business with the development capital to complete the 313,116 sq ft of offices, which is the final part of its Bothwell Exchange office campus in the heart of Glasgow. The deal comes as the city continues to see increasing demand for grade A office facilities.
Once complete, 177 Bothwell Street will be the largest multi-occupancy office building in Glasgow. It has already secured tenants, with Clydesdale Bank signing a 22-year lease for over 116,000 sq ft. In addition, HFD’s Managed Office division will also lease over 60,000 sq ft of the development.
The development incorporates a variety of sustainability features which are supported by the Bank of Scotland Green funding initiative. As part of the initiative, HFD will benefit from a margin discount of up to 20 bps on its cost of funding by delivering against agreed green covenants. These include achieving an A-rated Energy Performance Certificate, a BREEAM ‘Excellent’ rating and using 100 per cent renewable power, among others.
The building will boast Scotland’s first office rooftop running track, which will be 150m, extensive external roof terrace and charging points for electric vehicles. It is also the first development in Scotland to achieve platinum certification from WiredScore for IT connectivity and resilience.
The deal follows several financial arrangements from the Bank of Scotland to HFD for successful developments, including the neighbouring 122 Waterloo Street building in 2016, a £39.7m Green Lending Initiative loan for the University of the West of Scotland’s EcoCampus and a £54m investment loan for Sir Ian Wood House in Aberdeen.
Stephen Lewis, managing director at HFD Property Group, said: “Glasgow thriving business community needs new, quality office space to support its growth, help attract talent and new occupiers to the city.
“With Bank of Scotland’s backing we’ll be able to realise our ambition of supporting Glasgow’s economic growth by providing modern, sustainable space for world-class occupiers.”
Alan Brennan, relationship director for Bank of Scotland Real Estate and Housing, said: “Having worked with HFD for a number of years now, we’ve witnessed first-hand their commitment to both Scottish business and the environment.
“Our latest green loan to the group will help unlock a highly-sought after scheme that will be at the forefront of the commercial real estate market in the city for years to come, while rewarding HFD for its proactive approach in reducing its carbon footprint.”