Client: Greene King
Greene King is one of the UK’s largest regional brewers and pub operators. Recently, it decided to carry out a securitisation exercise to refinance a large portion of its estate following its acquisition of 432 pubs for £654m from Laurel Pub Company.
Our leisure team was appointed to undertake the valuation for Greene King. The securitisation portfolio comprised 904 pubs in a wide variety of locations – city centre, suburban and rural, as well as being a mixture of managed and leased/tenanted properties. This was the first time a securitisation on a combined estate had been carried out.
Our valuation approach involved selecting a representative sample of 254 pubs and the data obtained from our detailed inspections was extrapolated to undertake a portfolio investment valuation. Furthermore, we prepared individual market values reflecting the existing use of the sample properties and extrapolated these to assess the aggregate individual values for 904 pubs; these results were then compared with our portfolio investment valuation.
The next stage was to present our findings to the rating agencies, Fitch Ratings and Standard & Poor’s, as well as the Royal Bank of Scotland (Greene King’s bankers) in order to facilitate the rating of the bonds.
Our London and regional offices undertook all the valuation work in a short timescale. The portfolio was valued in excess of £800m and the portfolio was securitised in March 2005 for £600m.
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