Griffin-American Healthcare REIT IV Inc., a publicly registered non-traded real estate investment trust sponsored American Healthcare Investors LLC and Griffin Capital Corporation, has entered into a new credit facility totaling $400 million with Merrill Lynch, Pierce, Fenner & Smith Incorporated, KeyBanc Capital Markets and Citizens Bank National Association as joint lead arrangers and joint bookrunners.
The credit facility may be utilized for refinancing existing debt and for general corporate purposes, including property acquisitions.
The maximum principal amount of the credit facility may be increased to up to $650 million at the request of Griffin-American Healthcare REIT IV and satisfaction of certain conditions.
“We are pleased with our new credit facility and lending partners,” said Jeff Hanson, a founding principal of American Healthcare Investors and chairman and chief executive officer of Griffin-American Healthcare REIT IV. “This credit facility essentially replaces one that was due to mature in 2019 with better terms that we believe will benefit our investors and allow us to continue to accretively grow the portfolio of Griffin-American Healthcare REIT IV.”
Bank of America N.A. will serve as administrative agent, swing line lender and letters of credit issuer; KeyBank National Association will serve as syndication agent and an additional letters of credit issuer; and Citizens Bank National Association will serve as an additional syndication agent.
The credit facility matures on November 19, 2021 and may be extended for one 12-month period with the satisfaction of certain conditions, including payment of an extension fee.
At the option of Griffin-American Healthcare REIT IV, draws under the credit facility bear interest at per annum rates equal to (1) (a) the Eurodollar Rate, as defined by the credit facility, plus (b) a margin ranging from 1.75 percent to 2.20 percent per annum based on the REIT’s consolidated leverage ratio, or (2) (a) the greater of (i) Bank of America’s prime rate, (ii) the Federal Funds Rate, as defined by the credit facility, plus 0.50 percent, (iii) the one-month Eurodollar Rate plus 1.00 percent, and (iv) zero percent, plus (b) a margin ranging from 1.75 percent to 2.20 percent based on the REIT’s consolidated leverage ratio.
Griffin-American Healthcare REIT IV, which invests in medical office buildings, senior housing facilities and skilled nursing facilities, oversees a $807.6 million portfolio comprised of 58 properties totaling approximately 3.4 million square feet, as well as interest in a joint venture which owns or operates a portfolio of integrated senior health campuses and ancillary businesses.
The REIT launched its initial public offering in February 2016 and has raised approximately $610 million in investor equity as of the third quarter of 2018, according to Summit Investment Research. The offering is scheduled to close in February 2019.