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AIM-listed real estate investor Carpathian has announced that it has signed documentation to restructure all its debt facilities with Anglo Irish Bank.

The news comes days after Carpathian revealed it had successful restructured EUR 235 mln of debt with struggling German property lender Hypo Real Estate.

Carpathian, which was created in 2005 to invest in Central and Eastern European commercial real estate, said the arrangements involve Anglo Irish forbearing from exercising its rights under the three debt facilities for Silver Estate, Marise and Ironbark.

These are the special purpose vehicles holding the Interfruct, Marina Mokotow and Ericsson assets, collectively known as the Anglo Irish Secured Assets. All three will be cross-guaranteed and cross-secured. The forbearance arrangements will expire on 31 December 2009.

For its part, Carpathian has agreed to provide a total of EUR 3 mln of funding to the Anglo Irish Secured Assets, of which EUR 1.5 mln will be provided as a mezzanine debt facility and a further EUR 1.5 mln will be provided as a subordinated debt facility to the relevant SPV borrowers. Anglo Irish has agreed to defer a portion of the cash interest due from the Interfruct SPV group until the expiry date, at which point any deferred interest will need to be paid.

Following agreement on the terms of this debt restructuring, the surplus proceeds from the disposal of the Varyada Shopping Centre announced on 24 December 2008, which are jointly held with Anglo Irish pending agreement on debt restructuring become available. As a result, the remaining funds in excess of the EUR 3 mln to be provided to the SPVs, held from the disposal of Varyada Shopping Centre, totalling in excess of EUR 7.5 mln after costs, are to be released for use by the company on completion, which is currently expected by the end of July 2009.

As part of the arrangements, Anglo Irish has the option to acquire all equity in Silver Estate, Marise and Ironbark post the Expiry Date for a nominal sum. The acquisition of equity will not affect the Carpathian Mezzanine Debt Facility, but will invalidate the Carpathian Subordinated Debt Facility.

'This transaction again demonstrates Carpathian's ability to find solutions with its key lenders to restructure its debt portfolio,' said Rory Macnamara, chairman of Carpathian.

'Carpathian has been able to increase its free cash reserves by releasing moneys previously held in escrow and therefore further enhancing the stability of the company. Carpathian will continue to review its debt positions very closely in the current market and focus on further stabilising its capital base over the medium term in line with the outcome of the strategic review completed earlier in the year.'