Annual Report - Campus Living Villages

Campus Living Villages Annual Report 09/10 9
Campus Living Villages Fund
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2010
Debt refinancing
The original Century 17 portfolio is financed by US$201m
(A$236m) of borrowings from the Royal Bank of Scotland
(RBS), of which US$181m is due for repayment in April 2011 and
US$20m is due in April 2014. The US$181m borrowings have
been included in current liabilities, resulting in a net current
liability of $195m on the balance sheet as at 30 June 2010. The
RBS borrowings are held by a syndicate of banks of which RBS
is both a participant and the Agent. The Fund is in the process
of refinancing the RBS debt through a private placement of
debt in the United States, which is expected to be completed
before 31 December 2010. The Fund has appointed RBS as the
exclusive placement agent and is in the process of having the
placement of debt rated. The Fund will also pursue alternative
forms of finance such as project debt facilities if these yield
a result which is more favourable than that of the private
placement market.
As noted above, although the Fund is in the process of
refinancing the RBS borrowings, this process is not yet
complete, resulting in a net current liability position at 30 June
2010. The existence of a net current liability position suggests
a material uncertainty which may cast doubt on the Fund’s
ability to continue as a going concern and therefore its ability
to realise its assets in the normal course of business and at the
amounts disclosed in the financial statements. The financial
statements have been prepared on a going concern basis
as it is the Directors’ expectation, based on the information
available, that the current borrowings will be repaid through a
combination of debt refinancing, extending the existing debt
facility and using a portion of the uncalled equity of $80m.
Matters subsequent to the end of the financial year
The Fund was awarded a £40m contract to design,
build, operate and finance an 852 bed ensuite student
accommodation facility at the University of Bedfordshire’s
Luton campus in the UK and manage 853 study bedrooms of
the University’s facility.
The Fund made an equity call during July 2010 of $28.3m
to repay the EBF and cash back letters of credit and bank
guarantees effective 28 July 2010. The Fund is in the process
of refinancing the RBS debt of US$201m through a private
placement of debt in the US, which is expected to be
completed before December 2010.
The directors have not identified any other matters since 30
June 2010 that would require disclosure in the annual report
or adjustment to the financial statements or may significantly
affect the Fund’s operations in future financial years, the
results of those operations in future financial years, or the
Fund’s state of affairs in future financial years.
This report is made in accordance with a resolution
of directors.
John Niland
Chairman
FUND
Nicholas James
Director
Sydney
13 September 2010