Lloyds Banking Group is backing the owners of the O2 arena in Greenwich with a £185m loan to finance the building of a new designer shopping outlet to rival Bicester Village and Wembley.
The loan by Lloyds’ commercial banking arm will allow the O2’s owners AEG and Crosstree Real Estate, to push ahead with the 204,000 square feet shopping destination at the venue alongside its existing shops and restaurants.
The pair hope to attract luxury as well as high street brands which, like at Wembley’s London Designer Outlet and Bicester Village in Oxfordshire, would offer product ranges at a discount to their original price.
Work is expected to get underway this year, with the scheme expected to complete in late 2017.
John Feeney, global head of commercial real estate at Lloyds said: “This is the latest in a long-line of large-scale development projects that we have recently backed in the UK as well as being one of the biggest loans that we have fully underwritten.
“The deal is testament to the combined strengths of our balance sheet and distribution platform in being able to underwrite landmark transactions and to help turn developments that create hundreds of new jobs into reality,” he added.
The finance package is split between a development facility for the designer outlet and a refinancing of the existing retail and leisure component, Lloyds said.
Eastdil Secured advised Crosstree and AEG on the financing.