Black Creek Diversified Property Fund Secures $775 Million Credit Facility

The operating partnership subsidiary of Black Creek Diversified Property Fund Inc., a publicly registered NAV REIT formerly known as Dividend Capital Diversified Property Fund, has entered into a $775 million credit facility with a syndicate of lenders to amend and restate its existing senior unsecured revolving and term credit facility.

The funds are available for general business purposes including refinancing existing debt and financing the acquisition of permitted investments, including commercial properties.

Black Creek Diversified Property Operating Partnership LP secured a $450 million revolving credit facility that matures on January 31, 2023 and contains two six-month extension options, and a $325 million term loan due on January 31, 2024. The credit facility can be increased to a total of $1 billion, subject to certain conditions.

Based on its current consolidated leverage ratio, the company may borrow at LIBOR, plus 1.50 percent and LIBOR, plus 1.40 percent for the revolving credit facility and term loan, respectively.

The lenders include Bank of America N.A., Wells Fargo Bank N.A., PNC Bank N.A., JPMorgan Chase Bank N.A., US Bank N.A., Regions Bank, BMO Harris Bank N.A., Capital One N.A., Associated Bank N.A., Bank of the West, MUFG Union Bank N.A., and Raymond James Bank N.A.

Black Creek Diversified Property Operating Partnership also amended its existing senior unsecured term loan credit agreement by securing a $200 million unsecured term loan, which may be increased to up to $400 million under certain conditions.

The loan matures on February 27, 2022 and has a primary interest rate based on LIBOR, plus a margin ranging from 1.25 percent to 2.05 percent.

The lenders are Wells Fargo Bank N.A., Regions Bank; Capital One N.A., MUFG Union Bank N.A., and Raymond James Bank N.A.

Assuming the credit facility and senior unsecured term loan were in-place as of September 30, 2018, on a pro forma basis, this would have resulted in a decrease of the company’s overall weighted-average interest rate from 3.95 percent to 3.77 percent and an increase of its weighted-average debt maturity from 2.2 years to 3.9 years, before consideration of any available extension options.

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Griffin Capital Essential Asset REIT II Increases Credit Facility by $200 Million

Griffin Capital Essential Asset REIT II Inc., a publicly registered non-traded real estate investment trust, has increased its credit facility from $550 million to $750 million. The credit facility may be utilized to acquire, finance or re-finance properties, as well as for other corporate purposes.

“We are pleased to complete this refinancing as it extends the maturity, lowers financing costs and provides us with ongoing flexibility and access to more than $200 million of undrawn borrowing capacity as of the closing date, soundly positioning us for continued growth,” explained Javier Bitar, chief financial officer of the REIT.

KeyBank National Association serves as administrative agent of the credit facility, while the joint lead arrangers and joint bookrunners are KeyBanc Capital Markets, Merrill Lynch, Pierce, Fenner and Smith Incorporated, Capital One, SunTrust Robinson Humphrey Inc., Wells Fargo Securities LLC, and U.S. Bank National Association. Other participants include Fifth Third Bank, Associated Bank, National Association and Regions Bank.

The company noted that several terms were modified to improve funding capacity and reduce financing costs. Post renewal, the term loan portion of the credit facility matures on June 28, 2023 and the revolver portion matures on June 28, 2022 but may be extended for one additional year.

At the option of the REIT’s operating partnership, draws under the facility bear interest at annual rates equal to (1) for Eurodollar borrowings, the adjusted LIBOR rate plus a margin ranging from 1.25 percent to 2.20 percent based on the REIT’s consolidated leverage ratio or (2) for alternate base rate borrowings, the greater of KeyBank, National Association’s prime rate or the federal funds effective rate plus 0.50 percent, plus a margin ranging from 0.25 percent to 1.20 percent based on the REIT’s consolidated leverage ratio.

This week, The DI Wire reported that Griffin Capital Essential Asset REIT II Inc. reported increased net asset values from the month of June for all of its classes of shares of common stock.

Griffin Capital Essential Asset REIT II focuses on acquiring a portfolio consisting primarily of single tenant business essential properties throughout the United States and has acquired 35 office and industrial buildings for approximately $1.1 billion.

The offering was declared effective by the SEC in July 2014 and closed in January 2017 after raising $746 million in investor equity. The REIT commenced a follow-on offering as a perpetual life REIT in September 2017.

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