Essex Property gives final exchange results for three BRE note series

By Toni Weeks

San Luis Obispo, Calif., April 3 - Essex Property, Trust, Inc. announced the final tender results of operating partnership Essex Portfolio, LP's offer to swap out three series of senior notes, each with $300 million outstanding, issued by BRE Properties, Inc.

As of 11:59 p.m. ET on April 1, the expiration date, investors had tendered $274,188,000, or about 91.4%, of the 5.5% notes due 2017, $282,577,000, or 94.19% of the 5.2% notes due 2021 and $286,458,000, or 95.49%, of the 3.375% notes due 2023.

For the first two note series, the amounts are the same as the amounts tendered by 5 p.m. ET on March 18, the consent date. For the 3.375% notes due 2023, the amount is slightly higher than the 94.87% of notes tendered by the consent date.

As previously reported, the company received the needed majority of consents to amend each series of notes to eliminate substantially all of the restrictive and affirmative covenants, eliminate an event of default provision and modify other provisions. The amendments became effective April 1.

The offers were conditioned on the completion of BRE's merger with a wholly owned subsidiary of Essex.

As previously announced, the company offered new 5.5% senior notes due 2017, 5.2% senior notes due 2021 and 3.375% senior notes due 2023 to be issued by Essex Portfolio and guaranteed by Essex Property.

For each $1,000 principal amount of existing notes, Essex will issue a like amount of new notes and a cash payment of $2.50 to those who tender by the consent deadline. The total exchange value includes an early participation premium of $30.00 of notes and the $2.50 in cash.

Those who tendered after the early deadline will receive the total exchange value less the early premium and cash payment.

Settlement is expected April 4.

D.F. King & Co., Inc. was the information agent (800 967-4607 or call collect 212 269-5550; dfking.com/BRE).

Essex, a Palo Alto, Calif.-based real estate investment trust with a focus on multifamily residential properties, began the exchange offers on March 7.

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