The Loan Market Association (LMA) issued in 2012 the Single Currency Term Facility Agreement for Real Estate Finance Multiproperty Investment Transactions ("REF Document") used in the European primary market for real estate portfolio transactions for investing in multiproperty owning borrowers. The LMA Single Currency Term Facility Agreement for Real Estate Finance Development Transactions ("REF Development Document"), published in 2013, is the recommended form of primary market facility document use in the European syndicated financing market to finance single property development transactions.
The LMA REF facility documents were designed to meet the needs of the participants in the real estate finance market for a standardized form of real estate facility agreement. The LMA based the REF documents largely on the LMA Multicurrency Term Facility Agreement ("Primary Document") for the investment grade market, using the same basic structure and boilerplate.
Where applicable, elements are used for the REF facility documents from the LMA Senior Multicurrency Term and Revolving Facilities Agreement for Leveraged Acquisition Finance Transactions ("Leveraged Document") and the LMA Intercreditor Agreement. Both LMA template documents foresee use of only a single-currency fixed-term senior loan.
Although the REF documents are the recommended forms of facility agreement for use in real estate financing transactions, not all provisions will be appropriate for a given transaction and should be excluded or tailored as required. Numerous provisions must be adapted to the structure and commercial requirements of the parties to reflect the characteristics and complexities of the particular transaction.
The exclusion of provisions is not a departure from the LMA form. The LMA REF facility documents are only a good starting point for drafting of real estate finance facility agreements by providing a common framework and language.