Gramercy Property gets $400 million senior unsecured credit facility

By Tali Rackner

Norfolk, Va., May 12 - Gramercy Property Trust, Inc. signed a commitment letter with J.P. Morgan Securities LLC, Merrill Lynch Pierce, Fenner & Smith Inc. that provides for an up to $400 million senior unsecured credit facility, according to an 8-K filing with the Securities and Exchange Commission.

The facility consists of an up to $200 million senior revolving credit facility with a term of 48 months and a $200 million senior term loan facility with a term of 60 months.

The company may increase the amount of the credit facilities by up to $400 million, subject to the approval of the lenders providing such incremental financing and satisfaction of certain customary conditions.

Borrowings bear interest at Libor plus a margin of 135 basis points to 205 bps, depending on total leverage ratio.

The proposed credit agreement is expected to provide for customary covenants, including a total leverage ratio and unsecured leverage ratio of 60%, a minimum fixed-charge coverage ratio of at least 1.5x, a consolidated tangible net worth covenant and an unsecured interest coverage ratio of at least 2x.

New York-based Gramercy Property Trust is a commercial real estate investment company and asset management business.

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