Industrial Property amendment increases availability to $750 million

By Wendy Van Sickle

Columbus, Ohio, Dec. 9 – Industrial Property Operating Partnership LP entered into an amendment to its credit agreement on Tuesday increasing its borrowing availability to $750 million consisting of a $500 million revolving credit facility and a $250 million term loan, according to an 8-K filed with the Securities and Exchange Commission.

The agreement’s previous capacity was $400 million.

Under the amended facility Industrial Property may request up to an additional $250 million.

The revolver matures Jan. 31, 2020 and has a one-year extension option.

The term loan may be drawn upon for up to 180 days from closing and matures Jan. 31, 2021.

Borrowings will bear interest at Libor times a statutory reserve rate plus a margin of 140 basis points to 230 bps for the revolver and 135 bps to 220 bps for the term loan. The margin will be determined by the partnership’s leverage ratio and whether it has achieved investment-grade ratings.

The joint bookrunners were J.P. Morgan Securities LLC and Wells Fargo Securities, LLC; they were joined as lead arrangers by Bank of America Merrill Lynch and U.S. Bank NA.

JPMorgan Chase Bank, NA acted as administrative agent; Wells Fargo Bank, NA as syndication agent; and Bank of America, NA, U.S. Bank NA and Regions Bank as co-documentation agents.

Proceeds are available for general corporate purposes, including the acquisition and operation of permitted investments.

At closing, $200 million was outstanding under the revolver with an interest rate of 1.68%, and the term facility was undrawn.

The agreement requires includes covenants concerning consolidated tangible net worth, a consolidated fixed charge coverage ratio, a consolidated leverage ratio, secured debt, secured recourse debt, an unencumbered interest coverage ratio, a maximum unencumbered property pool leverage ratio and unencumbered property pool criteria.

The real estate investment trust is based in Denver.

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