Franklin Street Properties borrows $150 million two-year bridge loan

By Angela McDaniels

Tacoma, Wash., Dec. 2 – Franklin Street Properties Corp. borrowed a $150 million bridge loan due Nov. 30, 2018 on Wednesday, according to an 8-K filing with the Securities and Exchange Commission.

The company used the proceeds and cash on hand to buy two office towers in Denver for $154.3 million. It expects to repay the loan at maturity or earlier from the proceeds of property dispositions.

The initial interest is Libor plus 135 basis points. The margin over Libor ranges from 110 bps to 185 bps depending on the company’s ratings.

JPMorgan Chase Bank, NA, Citizens Bank, NA and Bank of Montreal are the bookrunners and lead arrangers. Citizens Bank and Bank of Montreal are the syndication agents. JPMorgan is the administrative agent.

The credit agreement contains financial covenants that require the company to maintain a minimum tangible net worth, a minimum fixed charge coverage ratio, a maximum secured leverage ratio, a maximum leverage ratio, a maximum unencumbered leverage ratio, a minimum unsecured interest coverage ratio and a maximum ratio of certain investments to total assets.

Based in Wakefield, Mass., Franklin Street is a real estate investment trust focused on investments in commercial properties.

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