REIT preferreds lead trading; new issues from Saratoga, KeyCorp up; secondary market firms

By Colin Hanner

Chicago, Dec. 16 – Real estate investment trusts were some of the heaviest-traded securities in the preferred market on Friday as preferreds in general strengthened.

The Wells Fargo Hybrid and Preferred Securities index was up 23 basis points on the day. It was up 28 bps at mid-morning.

The iShares U.S. Preferred Stock ETF was up 16 bps. It was up 23 bps at mid-morning.

A trader said three of the top-five highest volume traded preferreds were from REITs, offering that it was “probably somebody rebalancing on the REIT side.”

Digital Realty Trust’s 7.375% series H cumulative redeemable preferreds (NYSE: DLRPrH) traded up 3 cents to $28.60.

A trader said the securities were up 5.8 cents to $26.828.

Taubman Centers’ 6.25% series K cumulative redeemable preferreds (NYSE: TCOPrK) were down 11 cents to $24.06.

Seeing the largest volume of the day were PNC Financial Services Group’s 6.125% series P fixed-to-floating noncumulative preferreds (NYSE: PNCPrP), which traded up 17 cents to $26.78.

The 3.7 million-plus volume was “huge,” a trader said.

Saratoga Investment Corp.’s $65 million of 6.75% $25-par notes due 2023 – a deal priced Wednesday – traded at $24.74 in the afternoon session, after trading with a $24.70 bid, $24.80 offer mid-morning, a trader said.

Another trader said the volume was “light.”

KeyCorp’s $500 million of 6.125% series E fixed-to-floating rate noncumulative perpetual preferred stock (NYSE: KEYPrI) was up 12 cents to $25.47.

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