Morning Commentary: Hersha Hospitality to price cumulative preferreds; DTE Energy frees to trade

By Stephanie N. Rotondo

Seattle, May 24 – There continued to be deals coming out of the primary preferred stock market on Tuesday.

Hersha Hospitality Trust announced an offering of at least $100 million series D cumulative redeemable preferred stock.

Price talk is around 6.625%, according to a market source.

A trader said the paper was at $24.75 bid, no offer in the early gray market.

He added that there is no selling group.

Morgan Stanley & Co. LLC, BofA Merrill Lynch, Raymond James & Associates Inc., Wells Fargo Securities LLC and Citigroup Global Markets Inc. are leading the non-rated deal.

Proceeds from the sale will be used to redeem the 8% series B cumulative redeemable preferreds (NYSE: HTPB). That issue was trading off a penny at $25.32 at mid-morning.

From Monday’s business, DTE Energy Co.’s $300 million offering of 5.375% $25-par 2016 series B junior subordinated debentures due June 1, 2076 had freed to trade by mid-morning.

A trader quoted the issue at $24.90 bid, $24.95 offered.

BofA, UBS Securities LLC and Wells Fargo were the bookrunners.

Deals from last week were also seen trading.

A trader said LaSalle Hotel Properties’ $150 million of 6.3% series J cumulative preferreds were around $25.06, while Government Properties Income Trust’s $300 million of 5.875% $25-par senior unsecured notes due 2046 were pegged at $24.85 bid.

LaSalle priced Wednesday, and Government Properties came Thursday.

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