Slate gets $450 million four-year term loan, three-year revolver

By Susanna Moon

Chicago, Dec. 22 – Slate Retail REIT said it obtained a $450 million corporate credit facility, consisting of a $225 million four-year term loan and a $225 million three-year revolving facility.

Interest on the loans is Libor plus 175 basis points to 250 bps.

Proceeds will be used for general corporate purposes and future acquisition opportunities.

KeyBank Capital Markets is the lead arranger and bookrunner. CIBC, Bank of America and BMO Capital Markets are co-syndication agents. Lenders also include Royal Bank of Canada, Bank of Nova Scotia, TD Bank and Raymond James.

The term loan has one 12-month extension option. The revolver has two 12-month extension options.

The debt financings extend the real estate investment trust’s debt maturity to about 5.2 years, effectively matching the REIT's weighted average lease term, according to a company press release.

Additionally, the REIT now has a significantly higher percentage of fixed-rate debt and lower overall interest costs. The corporate facility includes structural enhancements that provide the REIT with the flexibility to convert to an unsecured structure in the future.

The facility replaces about $240 million of existing corporate credit facilities.

"As a significant owner of Slate Retail, management fundamentally understands the importance of a prudent debt capital strategy," Blair Welch, the company’s chief executive officer, said in the press release.

"Combined, these latest financing initiatives extend the REIT's debt maturity profile, lower interest costs and meaningfully increase the proportion of fixed-rate debt.

“The corporate facility in particular provides committed debt capacity to capitalize on what, in our view, is an exceptional opportunity to acquire high-quality grocery-anchored shopping centers across the United States at attractive prices, below replacement costs."

Slate Retail is an open-ended real estate investment trust based in Toronto.

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