CBL Properties closes on $1.19 billion credit facility in two parts

By Wendy Van Sickle

Columbus, Ohio, Jan. 30 – CBL Properties closed on a new $1,185,000,000 senior secured facility, comprising a fully funded $500 million term loan and a $685 million revolving line of credit, according to a press release.

The new facility matures in July 2023 and bears a floating interest rate of Libor plus 225 basis points.

The term loan balance will be reduced by $35 million per year, paid in quarterly installments.

The facility replaces all of the company’s prior unsecured bank facilities, which totaled $1,795,000,000, including three unsecured term loans totaling $695 million and three unsecured revolving lines of credit with aggregate capacity of $1.1 billion that were due to mature in October 2020.

At closing, the company used its new line of credit to reduce the principal amount of term loans by $195 million, after which the new line of credit had an outstanding balance of $419.8 million.

Wells Fargo Securities, LLC, U.S. Bank NA, PNC Capital Markets LLC, Citizens Bank, NA, JPMorgan Chase Bank, NA and Regions Capital Markets served as joint lead arrangers. Wells Fargo Bank, NA served as administrative agent.

“We have accomplished a number of important goals with this closing,” Farzana Khaleel, executive vice president and chief financial officer, said in the release.

“First, we have removed near-term financing risk, with no unsecured debt maturities until December 2023.

“This significant lengthening of our maturity schedule provides us with a clear runway to execute our business plan of redeveloping former department stores and transforming our properties into suburban town centers.

“Second, we have meaningfully enhanced our liquidity and financial flexibility, particularly when coupled with the increased free cash flow created through our dividend adjustment.

“Finally, the new facility is simplified and right-sized, removing inflexible covenants and reducing the cost expended for unused and unneeded excess capacity.”

CBL is a Chattanooga, Tenn.-based owner and manager of a national portfolio of market-dominant properties located in dynamic and growing communities.

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