£169 million residential ground rents and student accommodation       
The use of derivatives to bring more certainty to future income the result being higher debt

This substantial private investment company has built up major holdings in ground rents and separately student accommodation let to the universities.

They both have a similarity inasmuch as rental growth has the retail price index to underpin it.

The derivatives market can project forward and commit to future rental growth, thereby enabling certainty of future cash flow. This enables lenders to consider higher loan to values.

This derivative structure was incorporated into a loan requirement of £169 million.

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