Taubman Realty amends revolver and term loan maturity, pricing

By Marisa Wong

Los Angeles, Nov. 1 – Taubman Realty Group LP, a subsidiary of Taubman Centers, Inc., entered into a second amended and restated revolving credit and term loan agreement on Oct. 28 with JPMorgan Chase Bank, NA as administrative agent, according to an 8-K filing with the Securities and Exchange Commission.

The credit agreement amends and restates Taubman’s existing amended and restated credit agreement dated Feb. 1, 2017.

The restated credit agreement extends the maturity date of the revolver to Feb. 1, 2024, with two six-month extension options.

Interest for the revolver is equal to Libor plus 105 basis points to 160 bps, depending on the company’s total leverage ratio. The facility fee ranges from 20 bps to 25 bps, also based on the total leverage ratio. At closing, pricing was Libor plus 137.5 bps with a 22.5 bps facility fee.

The credit agreement reduces the unsecured term loan to $275 million from $300 million. The company used the revolver to fund payments for the reduction in the term loan.

In addition, the amendment extended the maturity date of the term loan to Feb. 1, 2025.

The term loan now bears interest at Libor plus 115 bps to 180 bps, based on the company’s total leverage ratio. At closing the interest rate was Libor plus 155 bps.

Under the credit agreement, Taubman may request an increase in the revolving commitments or establish one or more term loans with a maximum aggregate increase of $625 million, bringing the aggregate total commitment under the credit agreement to $2 billion, subject to obtaining additional lender commitments, customary closing conditions and covenant compliance for the unencumbered asset pool.

The entities owning Beverly Center, Dolphin Mall and The Gardens on El Paseo remain guarantors under the credit agreement, and the shopping centers owned by those entities are unencumbered assets, the filing noted.

The credit agreement also contains a number of financial covenants including, among others, minimum net worth of $2 billion, maximum total leverage ratio of 60% and minimum fixed-charge coverage ratio of 1.5 to 1.0.

JPMorgan Chase Bank, PNC Capital Markets LLC and Wells Fargo Securities, LLC are the joint lead arrangers and joint bookrunners. PNC Bank, NA and Wells Fargo Bank, NA are co-syndication agents. U.S. Bank NA and SunTrust Bank are documentation agents.

Taubman Centers is a real estate investment trust based on Bloomfield Hills, Mich.

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