Maslow Capital Closes £136.8M Facility for Vita Group at Manchester's Circle Square Towers
Specialist real estate finance provider Maslow Capital has completed a £136.8 million facility for Vita Group, secured by the North and East Towers at Circle Square, a mixed-use development along Manchester's Oxford Road corridor, the firm announced Oct. 6.
The facility refinances the towers' existing debt and supports Vita Group's acquisition of its joint venture partner's interest in both towers, bringing them into full Vita ownership. It will also support the phased sale of 487 completed and let apartments, along with 14 ground-floor commercial units.
Facility Structure and Ownership Change
The facility is a short-term secured loan structured around the completed, income-producing towers rather than a construction programme. Rental income services the debt while unit sales proceed, according to Maslow Capital.
The transaction follows the sale by Greater Manchester Pension Fund of its 50% interest in the residential element to Vita Group. The wider joint venture was associated with 683 build-to-rent apartments across the two buildings. The 487-unit figure cited in the announcement reflects the apartments covered by the current sale programme and may not represent the total number of apartments in both towers. Earlier marketing materials identified 411 apartments in the North Tower and 266 in the East Tower, indicating that published counts use differing definitions.
Based on the 487 apartments in the sale programme, the facility equates to roughly £281,000 of debt per apartment. That figure is a calculation and not a reported loan-to-value ratio or valuation.
Apartments are sold fully furnished as income-producing investments and are attracting demand from both UK and international purchasers, the firm said. Units are being sold in phases rather than in a single bulk transaction.
Circle Square and the Oxford Road Corridor
Circle Square was developed on the former BBC site on Oxford Road. It combines residential, Grade A office, retail and leisure space with public open space, including Symphony Park at its centre. John Sisk & Son delivered the North and East Towers, which reached practical completion in 2021.
Residents' amenities include a 24-hour concierge, private dining rooms, a cinema room and resident lounges. The North Tower also offers a gym and dedicated co-working space.
The scheme is within walking distance of the University of Manchester, Manchester Metropolitan University and the city's central business district, and is a minute's walk from Oxford Road station. Marketing materials describe the North Tower as about 94% occupied and the East Tower as about 97% occupied. Circle Square is planned to include approximately 1,700 homes and 1.2 million square feet of workspace, along with restaurants, bars, shops, hotels and a central public park.
Comments From Maslow Capital and Vita Group
Matt Pigram, Senior Director, Origination at Maslow Capital, said: "Circle Square is a completed, income-producing asset in one of Manchester's strongest city-centre locations, with a unit sales programme that was already well progressed. The facility gives Vita the flexibility to refinance, take full ownership of the towers and continue executing its strategy for the assets, with rental income servicing the debt in the meantime. It is a clear example of how a facility can be structured around an operating asset rather than a construction programme."
Daniel Murray, Senior Director, Short-Term Finance at Maslow Capital, said: "Large completed residential schemes increasingly need funding that bridges the period between practical completion and the sale of the final units. That is exactly what our short-term finance offering is designed to do. Working with a sponsor we know well, on an asset of this scale and standing, meant we could deliver a substantial facility within the borrower's timetable."
Peter Shipley, Finance Director at Vita Group, said: "Bringing the North and East Towers into full Vita ownership was a natural opportunity for us given our long-standing history with Circle Square. These are high-quality, established assets, and our facility with Maslow gives us the flexibility to execute the next phase of our strategy while continuing to operate the buildings as successful, income-producing investments. Our established relationship with Maslow, and their understanding of both our business and the assets helped us deliver the transaction efficiently."
Vita Group is a developer and operator of purpose-built student and residential living assets across the UK and Europe. Maslow Capital has an existing relationship with the group and previously financed Select Properties' Port Street and City Suites 2 schemes in Manchester.
Manchester Market Context
Manchester's residential market continues to see structural demand, while supply is expanding. Deloitte's Manchester Crane Survey recorded 4,448 homes completing construction, 11 residential schemes totalling 2,410 homes starting on site, and 10,788 homes under construction or scheduled for delivery over the following four years. The survey reported annual rental growth of 11.4%.
The Oxford Road corridor is particularly active in student accommodation. The survey identified 3,894 purpose-built student accommodation units across five schemes under construction, with a further 9,780 student beds at pre-planning or planning stage along the corridor.
For lenders, the Circle Square collateral is completed, occupied and generating rental income, which shifts the main risks from construction to the pace and pricing of apartment sales, investor demand for furnished units, refinancing conditions at maturity and competition from new build-to-rent, co-living and student schemes. The transaction illustrates a financing approach for large completed residential schemes moving from rental operation to individual unit sales.