Phillips Edison & Company Inc., an internally managed real estate investment trust that invests in grocery-anchored shopping centers, has secured a 10-year, $200 million secured debt facility through Hartford Investment Management Company.
The REIT intends to use the proceeds from the loan to prepay loans that mature in 2020 and 2021, and for general corporate purposes.
The 3.35 percent interest-only note is secured by 16 grocery-anchored shopping centers and extends the company’s debt maturity profile to 5.1 years from 4.3 years at September 30, 2019. Together with this secured financing, Phillips Edison & Company said that it has refinanced a total of $575 million of debt over the past three months.
“Over the past three months, we have capitalized on the current interest rate environment through a series of refinancing activities…,” said John Caulfield, chief financial officer of Phillips Edison. “Combined with the recent refinancing of two other term loans, our capital markets activity has improved our cost of capital and maintains our flexibility to capitalize on accretive long-term opportunities.”
Previously, in September 2019, the company repriced a $200 million term loan, lowering the interest rate spread from 1.75 percent over LIBOR to 1.25 percent over LIBOR, while maintaining the current maturity of September 2024.
In October, the company repriced a $175 million term loan, lowering the interest rate spread from 1.75 percent over LIBOR to 1.25 percent over LIBOR, while maintaining the current maturity of October 2024. In total, its recent refinancing activities have reduced its weighted average interest rate by nine basis points to 3.46 percent.
KeyBank Real Estate Capital and Fifth Third Bank served as advisors for this transaction.
In other company news, last month, Phillips Edison & Company merged with Phillips Edison Grocery Center REIT III, a publicly registered non-traded real estate investment trust co-sponsored by Phillips Edison & Company and Griffin Capital Company.
Phillips Edison & Company Inc. (formerly known as Phillips Edison Grocery Center REIT I Inc.) is one of the nation’s largest owners and operators of grocery-anchored shopping centers. The company oversees a portfolio of 330 properties, including 294 wholly-owned properties comprising approximately 33.2 million square feet across 32 states, as of September 30, 2019. The company’s offering was declared effective by the SEC in August 2010 and raised approximately $1.8 billion in investor equity before closing in February 2014.