Infrastructure firm HICL announces disposal of Sheffield student accommodation project for £18m

In an announcement to the London Stock Exchange, HICL said that the proceeds from the latest sale will be used to reduce the balance on its £650 million revolving credit facility.

The deal marks the ninth disposal of the year from the firm.

Following the disposals, HICL said it expects drawings on its revolving credit facility to be around £115 million, down from £370 million.

Edward Hunt, head of core income funds at InfraRed Capital Partners Limited, the company which manages HICL, said: "This latest transaction takes the total number of disposals for the year to nine, evidencing our active approach to asset recycling and the company's ability to reduce debt in a value accretive manner, notwithstanding wider macroeconomic volatility."

Completion on the Sheffield deal is expected before the end of the year, subject to third party consent.

The company added that the proceeds from the sale represent a small premium to its last audited valuation.

The latest deal follows HICL’s announcement in late September that it would sell its entire equity interests in the Bradford Building Schools for the Future phase one and phase two projects for a combined £37 million.

HICL initially invested in Bradford phase one in June 2014, and in Bradford phase two in June 2009, acquiring additional stakes in the Projects in 2021. The sale represented an 8 per cent premium to the company's last audited valuation.

Later in September, the firm also disposed of five other assets, including Queens (Romford) Hospital, Oxford John Radcliffe Hospital, Priority Schools North East Batch and South Ayrshire Schools, as well as half of its investment in the Hornsea II OFTO.

The company sold these assets to London-based property investment firm John Laing, for a total value of £204 million.

Oxford John Radcliffe Hospital, the largest of the five assets, was developed by Carillion. HICL acquired its interests in 2010 and 2012.

Following the liquidation of Carlillion in 2018, InfraRed’s asset management team led the project restructuring to resolve all outstanding contractual obligations.

The sale of these five assets marked a total £300 million raised by HICL through asset disposal since 31 March 2023.

Prior to the sales, In its annual latest results, completed to the year ended 31 March 2023, the company posted pre-tax profits of £198.5 million, down from £368.4 million the year prior.

Dividends per share remained at 8.25p.

Speaking at the time, Mike Bane, chairman of the board at HICL, said the results demonstrated the portfolio's strength and key defensive characteristics against what he described as a “volitile macroeconomic backdrop”.