Preferreds see choppy trading; National Storage, Fannie gain; Freddie, Hoegh decline

By Stephanie N. Rotondo

Seattle, Oct. 5 – The preferred stock market was initially trending upward on Thursday, though it ended the day slightly weaker.

There were, however, some signs of strength.

For instance, National Storage Affiliates Trust’s $150 million of 6% series A cumulative redeemable preferreds – a deal priced Tuesday – were trading up 20 cents to $25.10.

The issue was assigned a temporary ticker on Wednesday, “NSAFP.”

Pricing came at the tight end of the 6% to 6.125% talk.

Wells Fargo Securities LLC, Morgan Stanley & Co. LLC and Jefferies LLC were the joint bookrunners.

Fannie Mae’s 8.25% series S fixed-to-floating rate noncumulative preferreds (OTCBB: FNMAS) were also ending the day with a firm tone, though the paper had been down at mid-morning.

The preferreds finished the day at $7.02, up 7 cents, or 1.01%.

But Fannie’s peer Freddie Mac wasn’t as lucky, as its 8.375% fixed-to-floating rate noncumulative preferreds (OTCBB: FMCKJ) dipped 3 cents to $6.87.

Meanwhile, Hoegh LNG Partners LP’s $100 million of 8.75% series A cumulative redeemable preferred units – which have been posting sizable gains in the last couple of sessions – were giving back some of their recent gains, falling 20 cents, to $25.50.

The deal priced Sept. 28. It has a temporary symbol, “HGLPF.”

The day also saw a new issue entering the market, a $125 million offering of 8% series D fixed-to-floating rate cumulative redeemable preferreds from New York Mortgage Trust Inc.

A market source said he heard the deal was well oversubscribed.

The new issue came at the tight end of the 8% to 8.125% price talk. It was also increased from an expected $50 million.

Morgan Stanley, UBS Securities LLC and Keefe Bruyette & Woods Inc. ran the books.

The dividend rate will be fixed until Oct. 15, 2027, at which point the rate will float at Libor plus 569.5 basis points.

The preferreds become redeemable on Oct. 15, 2027 at par plus accrued dividends.

The issue can also be redeemed upon a change of control.

The New York-based real estate investment trust will use proceeds to acquire certain targeted assets and various other types of mortgage-related and financial assets that the company may target from time to time. The funds may also be used for general working capital purposes, including the repayment of debt.

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