Healthpeak enters $500 million delayed-draw term facility via BofA

By William Gullotti

Buffalo, N.Y., Aug. 22 – Healthpeak Properties, Inc. entered into a $500 million delayed-draw term loan agreement on Aug. 22 with Bank of America, NA as administrative agent, according to an 8-K filing with the Securities and Exchange Commission.

The facility is available to be drawn from time to time during a 180-day period after closing, subject to customary borrowing conditions.

$250 million of the facility has a 4.5 year stated maturity, which may be extended for one year as long as Healthpeak pays a 12.5 basis point fee on the amount of the tranche of term loans to be extended, has no default or existing event of default and satisfies certain other customary commitments. The remaining $250 million matures in five years, without the option to extend.

The facility size may be increased, at the company’s option, up to $1 billion by incurring one or more incremental term loans, so long as no default or event of default exists and other customary conditions have been satisfied. Any such increase will be syndicated on a best-efforts basis, and no lender is required to increase its commitment under the agreement to facilitate such increase.

Borrowings will bear interest at SOFR+10 bps CSA plus a margin ranging from 75 bps to 160 bps. The margin is determined by the company’s long-term debt rating and was set at 85 bps at closing.

The company said it executed forward-starting interest rate swaps on Aug. 2 for a notional amount of debt of $500 million with termination dates similar to the initial stated maturities of the term loan facilities that will effectively fix the interest rate for the term loans at a blended rate of approximately 3.52%.

Commencing 60 days after closing, Healthpeak is obligated to pay a 15 bps ticking fee on the daily amount of undrawn commitments under the credit agreement.

The agreement includes a sustainability-linked pricing component which, subject to satisfying certain sustainability-linked metrics, can reduce the applicable margin by 1 bp.

Loans outstanding may be repaid from time to time without premium or penalty, other than customary breakage costs.

The agreement requires the company to limit the ratio of enterprise total indebtedness to enterprise gross asset value to 60%, to limit the ratio of enterprise secured debt to enterprise gross asset value to 40% and to limit the ratio of enterprise unsecured debt to enterprise unencumbered asset value to 60%. Healthpeak is also required to maintain a minimum fixed charge coverage ratio of 1.5 times and minimum consolidated tangible net worth of $7.7 billion.

At closing, the term loan facilities remained undrawn.

BofA Securities, Inc. and Wells Fargo Securities, LLC are the joint lead managers and joint bookrunners, with PNC Capital Markets LLC, Bank of Nova Scotia and Truist Securities, Inc. also serving as joint lead managers.

Wells Fargo Bank, NA, PNC Bank, NA, Scotia and Truist Bank are the co-syndication agents.

Mizuho Bank, Ltd., Regions Bank and Toronto-Dominion Bank are the co-documentation agents.

Healthpeak Properties, Inc. is a real estate investment trust based in Denver that owns and develops health care real estate within the United States.

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