ING UK Real Estate Income Trust has entered into intergroup transfer arrangements for Rugby Real Estate Investment Trust, whereby the Rugby Reit assets will be held within Guernsey domiciled companies in a more tax efficient manner.

Three assets have exchanged contracts for sale with an aggregate value of GBP1.68m.

As a result of the transfer of these assets, the company has renegotiated the associated debt facility until January 2013, which coincides with the maturity of the existing securitised facility. The new facility is reduced to GBP21.3 m. The number of charged assets under the facility has also been reduced so that GBP51.9m of assets remain charged under the facility with GBP17.1m uncharged.

The prepayment fees payable by the borrower will reduce from 0.50 per cent (if prepayment is made on or prior to 24 August 2011) to 0.25 per cent (if prepayment is made after this but on or prior to 24 August 2012) and nothing thereafter.

There is a requirement to hedge at least 50 per cent of the facility amount based on a margin of 185 bps above Libor. The day one floating rate prior to this hedge being put in place will be 0.72 per cent.

Following this transaction the company will have further financial flexibility, which will enable it to reinvest proceeds from sales and/or substitute properties.