Brookfield, GGP obtain $4.9 billion term loans, $1.5 billion revolver

By Wendy Van Sickle

Columbus, Ohio, Aug. 28 – Brookfield Property REIT Inc. entered into a credit agreement dated Aug. 24 that provides for $4.9 billion of term loans and a $1.5 billion revolving credit facility, according to an 8-K filing with the Securities and Exchange Commission.

The term total includes a $900 million term A-1 loan, a $2 billion term A-2 loan and a $2 billion term B loan.

Each tranche of term loans was fully funded at closing, and $217 million was drawn under the revolver.

The term A-1 is scheduled to mature in three years with an option for Brookfield to extend its maturity by one additional year. The term A-2 is scheduled to mature in five years. The term A-1 and A-2 loans have no scheduled amortization payments for the first three years and will amortize quarterly at a rate of 5% per annum thereafter.

The revolver is scheduled to mature in four years, with a one-year extension option.

Borrowings under the revolver and term A-1 and A-2 loans will bear interest at Libor plus a margin ranging from 200 basis points to 250 bps, depending on Brookfield’s total net indebtedness to value ratio.

The term B will mature in seven years and amortizes quarterly at 1%. It bears interest at Libor plus 250 bps.

Morgan Stanley Senior Funding Inc., Wells Fargo Securities LLC, Deutsche Bank Securities Inc. and RBC Capital Markets are the joint bookrunners.

Wells Fargo, Deutsche, Morgan Stanley, RBC, Bank of America Merrill Lynch, Barclays, HSBC Securities (USA) Inc., Sumitomo Mitsui Banking Corp., TD Securities LLC, Citibank, NA and U.S. Bank NA are the joint revolver and term loan A-1 and A-2 lead arrangers.

Morgan Stanley, RBC, Deutsche, Wells Fargo, Barclays, HSBC, Bank of America Merrill Lynch, Sumitomo and TD Securities are the joint term loan B lead arrangers.

Wells Fargo is the administrative agent.

Morgan Stanley is the term loan B agent.

Proceeds were used on Monday to fund a portion of Brookfield’s acquisition of all outstanding shares of common stock of GGP Inc. and to refinance Brookfield’s existing revolver.

Future revolver proceeds may be used for working capital needs and other general corporate purposes.

Brookfield Retail Holdings VII Sub 3 LLC, GGP Nimbus, LLC, GGP Ltd. Partnership LLC, BPR OP, LP, GGSI SellCo, LLC, GGPLP Real Estate 2010 Loan Pledgor Holding, LLC, GGPLPLLC 2010 Loan Pledgor Holding, LLC, GGPLP 2010 Loan Pledgor Holding, LLC and GGPLP LLC are also borrowers under the credit agreement.

GGP is a Chicago-based owner, manager, leaser and redeveloper of high-quality retail properties. Brookfield Property is a commercial real estate company.

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