Griffin-American closes three-year $100 million line of credit

By Wendy Van Sickle

Columbus, Ohio, Aug. 26 – Griffin-American Healthcare REIT IV, Inc. entered a credit agreement for a three-year up to $100 million revolving line of credit on Thursday, according to an 8-K filing with the Securities and Exchange Commission.

The credit agreement was led by Bank of America Merrill Lynch and KeyBanc Capital Markets as joint lead arrangers and joint bookrunners, Bank of America, NA as administrative agent and KeyBank, NA as syndication agent.

Borrowings bear interest at Libor plus an initial margin of 175 basis points, with the margin ranging from 175 bps to 225 bps, depending on consolidated leverage ratio. There is a commitment fee of either 20 bps or 50 bps, depending on use.

There is a $20 million sublimit for standby letters of credit and a $25 million sublimit for swing line loans. The line of credit matures on Aug. 25, 2019 and may be extended for one 12-month period subject to satisfaction of certain conditions, including payment of an extension fee.

The maximum principal amount may be increased by up to $100 million.

The proceeds of loans made under the line of credit may be used for working capital, including acquisitions, capital expenditures and other general corporate purposes. At closing, no borrowings were drawn under the line of credit.

The credit agreement requires the company to comply with covenants including a consolidated leverage ratio; a consolidated tangible net worth; a fixed-charge coverage ratio; an unencumbered indebtedness yield; a consolidated unencumbered leverage ratio; and a consolidated unencumbered interest coverage ratio, among others.

Griffin-American is an Irvine, Calif.-based real estate investment trust building a portfolio of health-care real estate assets, focusing primarily on medical office buildings, senior housing facilities, skilled nursing facilities and hospitals.

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