iStar driving by with $400 million 5.5-year notes; initial guidance low-to-mid 5% area

By Paul A. Harris

Portland, Ore., Aug. 18 – iStar Inc. plans to price a $400 million public offering of senior notes due February 2026 (existing ratings Ba3/BB/BB) in a Tuesday drive-by trailing a late-morning conference call with investors, according to market sources.

Initial talk has the notes coming to yield in the low-to-mid 5% area, a bond trader said.

BofA Securities Inc. is the left bookrunner. J.P. Morgan Securities LLC, Barclays, Morgan Stanley & Co. LLC and Goldman Sachs & Co. LLC are the joint bookrunners.

Raymond James & Associates Inc., Citigroup Global Markets Inc. and Mizuho Securities USA Inc. are the co-managers.

The notes, which have a tenor of approximately 5.5 years, become callable after two years at par plus 50% of the coupon. They have a two-year 35% equity clawback at par plus the coupon and have a 101% poison put.

The New York-based services provider to the real estate industry plans to use the proceeds to redeem $400 million of its 5¼% senior notes due 2022.

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