CubeSmart completes $800 million financing through loan amendments

By Marisa Wong

Madison, Wis., June 18 - CubeSmart said it completed about $800 million of unsecured bank financing through amendments to its existing credit facility and term loan agreements.

The financing includes an amended $200 million senior term loan facility and an amended $600 million senior credit facility.

"With our amended credit facilities, we benefit from substantially improved pricing as well as extended terms that reinforce our well-staggered debt maturity profile," Tim Martin, chief financial officer, commented in a press release.

"We are delighted to have strong and continued support from our longstanding banking relationships. This recommitment from our banks further solidifies our financial position and enhances our ability to execute on our business plan."

$200 million facility

CubeSmart's amended $200 million term loan facility consists of two $100 million term loans, each maturing in June 2018.

One of the loans, the term loan A, was originally a five-year loan with a June 2016 maturity. The maturity of the term loan B, originally a seven-year loan, remains unchanged.

The borrowing rate is based on the company's credit rating. At the existing Baa3/BBB- level, the term loan A is priced at Libor plus 150 basis points, while the term loan B is priced at Libor plus 200 bps.

Previously, the term loan A and term loan B were priced at Libor plus 185 bps and Libor plus 200 bps, respectively.

$600 million facility

CubeSmart's amended $600 million credit facility consists of a $100 million term loan due December 2014, a $200 million term loan D due January 2019 and a $300 million revolver due June 2017.

The company has the option to extend the term of the revolver for an additional year.

The borrowing rate under the credit facility is also based on the company's credit rating. Currently, the revolver is priced at Libor plus 160 bps, including a facility fee, and both of the term loans are priced at Libor plus 150 bps.

Prior to the amendment, the spread for the revolver was 180 bps, and the spread for the term loans was 175 bps.

The facility fee was reduced to 30 bps from 32.5 bps.

According to the release, the company did not enter into any new hedging arrangements in addition to the amended facilities. The existing arrangements remain in place as follows: $100 million due June 2016 at Libor plus 180.3 bps, $200 million due March 2017 at Libor plus 133.6 bps and $100 million due June 2018 at Libor plus 246.8 bps.

CubeSmart is a Wayne, Pa.-based real estate investment trust focused on self-storage facilities.

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