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CBRE details pricing for $400 million incremental term loan facility
By Marisa Wong
Morgantown, W.Va., Sept. 9 – CBRE Group, Inc. disclosed details on subsidiary CBRE Services, Inc.’s new $400 million term loan facility in an 8-K filed Wednesday with the Securities and Exchange Commission.
The company entered into the incremental term loans on Sept. 3 with Credit Suisse AG as administrative agent. Wells Fargo Securities, LLC and Credit Suisse Securities (USA) LLC are the joint bookrunners and joint lead arrangers for the tranche B-1 term loan, and Wells Fargo Securities, LLC and Royal Bank of Scotland plc are the joint bookrunners and joint lead arrangers for the tranche B-2 term loan.
The $270 million tranche B-1 term loan matures in five years and has an initial interest rate of Libor plus 115 basis points. The $130 million tranche B-2 term loan matures in seven years and has an initial interest rate of Libor plus 160 bps.
If CBRE Services continues to maintain investment-grade status, interest will be based on ratings. In this case, the applicable spread for tranche B-1 loans ranges from 95 bps to 125 bps, and the spread for tranche B-2 loans ranges from 140 bps to 170 bps.
If CBRE Services fails to maintain investment-grade status, interest will be based on leverage. In this case, the spread for tranche B-1 loans ranges from 137.5 bps to 185 bps, and the spread for tranche B-2 loans ranges from 187.5 bps to 235 bps.
As noted before, the $270 million term loan is prepayable at any time without penalty, and the $130 million term loan is prepayable at any time without penalty after Sept. 3, 2017.
The new facility follows the completion of a $600 million investment-grade senior notes offering in August. The senior notes mature in 2026 and have an interest rate of 4.875%.
CBRE is a Los Angeles-based commercial real estate services and investment firm.
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