Summit Germany has confirmed subsidiaries of the AIM-listed German commercial property investment group have breached the loan-to-value covenant of 85% on a EUR 96 mln loan facility.
Summit Germany has confirmed subsidiaries of the AIM-listed German commercial property investment group have breached the loan-to-value covenant of 85% on a EUR 96 mln loan facility.
Back in January Summit warned that most of the group debt facilities were close to the upper limit of their LTV covenants 'in the current difficult climate when property capital valuations are coming under severe pressure'.
The facility in breach relates to a portfolio representing approximately 12% of the group's current gross property assets. Summit said the interest cover covenant on this facility was within its limits 'due to the relevant portfolio's strong income stream'. Summit is now in talks with the lender about a resolution of the breach.
The same applies to the group's other facilities and the breach is not expected to impact these facility agreements, the company said. The group expects to announce its results for the financial year ended 31 December 2008 on 31 March 2009.
