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S&P rates QTS Realty loan BB-
Standard & Poor’s said it assigned a BB- rating and 2 recovery rating to QTS Realty Trust Inc.’s amended-and-extended $900 million unsecured credit facility.
The 2 recovery rating reflects 70% to 90% expected default recovery.
The unsecured debt will be issued out of wholly-owned subsidiary QualityTech LP.
The BB- rating with 2 recovery rating on the company’s existing unsecured debt is unchanged.
The amended unsecured credit facility, which replaces the previous $650 million unsecured credit facility, consists of a four-year $600 million revolving credit facility and two $150 million term loans, one with a five-year maturity and the other with a 5.5-year maturity, S&P said.
The proceeds will be used to pay off the remaining $70 million balance on the company’s Richmond secured facility and partially pay down balances on the current revolving credit facility, the agency said.
The corporate credit rating on QTS Realty Trust remains at B+ with a stable outlook.
The transaction should contribute to modestly lower interest expense and improved liquidity, the agency said.
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