Published on 6/17/2021 in the Prospect News Investment Grade Daily.
New Issue: Sun Communities sells upsized $600 million 2.7% notes due 2031 at 125 bps spread
By Cristal Cody
Chicago, June 17 – Sun Communities Operating LP sold an upsized $600 million offering of 2.7% notes due July 15, 2031 (Baa3/BBB) at 99.467 to yield 2.761%, according to a market source and an FWP filed with the Securities and Exchange Commission.
The notes will be guaranteed by Sun Communities, Inc., a Southfield, Mich.-based real estate investment trust.
The notes priced with a Treasuries plus 125 basis point spread, low to the initial price talk which had them at the Treasuries plus 150 bps area. Originally, the issue size was expected at $350 million.
The notes have a make-whole call with a premium of Treasuries plus 20 bps and then a par call after April 15, 2031.
Citigroup Global Markets Inc., J.P. Morgan Securities LLC, BofA Securities Inc., BMO Capital Markets Corp. and RBC Capital Markets LLC are the bookrunners.
Proceeds will be used to repay debt under the company’s senior credit facility, to fund possible acquisitions of properties and for working capital and general corporate purposes.
Sun Communities Operating is the primary operating subsidiary of Sun Communities, Inc.
| Issuer: | Sun Communities Operating LP
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| Guarantor: | Sun Communities, Inc.
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| Issue: | Notes
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| Amount: | $600 million
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| Maturity: | July 15, 2031
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| Bookrunners: | Citigroup Global Markets Inc., J.P. Morgan Securities LLC, BofA Securities Inc., BMO Capital Markets Corp. and RBC Capital Markets LLC
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| Co-managers: | Citizens Capital Markets, Inc., Fifth Third Securities, Inc., Huntington Securities, Inc., Regions Securities LLC, Truist Securities, Inc., U.S. Bancorp Investments, Inc., Wells Fargo Securities, LLC, PNC Capital Markets LLC, Wedbush Securities Inc. and Samuel A. Ramirez & Co., Inc.
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| Coupon: | 2.7%
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| Price: | 99.467
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| Yield: | 2.761%
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| Spread: | Treasuries plus 125 bps
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| Call features: | Make-whole at Treasuries plus 20 bps until April 15, 2031; par call thereafter
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| Trade date: | June 17
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| Settlement date: | June 28
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| Ratings: | Moody’s: Baa3
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| S&P: BBB
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| Distribution: | SEC registered
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| Price talk: | Treasuries plus 150 bps area; size of $350 million
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