PS Business brings upsized new deal; recent issues trade off; Bank of America active

By Stephanie N. Rotondo

Seattle, Oct. 11 – The preferred stock market was “a little softer with the bond market being down and the stock market being down,” a trader said Tuesday.

The Wells Fargo Hybrid and Preferred Securities index declined 60 basis points for the day. The index was off 33 bps at mid-morning.

By comparison, the equity markets lost 1% to 1.5%.

Despite the weak tone, PS Business Parks Inc. added a new deal to the calendar, bringing a $165 million offering of 5.2% series W cumulative preferred stock.

Price talk was 5.25%, according to a market source. The deal came upsized from $100 million.

Prior to pricing, a source placed the issue at $24.70.

BofA Merrill Lynch, Morgan Stanley & Co. LLC and Wells Fargo Securities LLC are running the books.

As for deals priced last week, they were softening along with the market.

Bluerock Residential Growth REIT Inc.’s $67.5 million of 7.125% series D cumulative preferreds – a deal from Oct. 5 – were “kind of wide” at $24.55 bid, $24.80 offered, a trader reported.

“I think people are dumping whatever they had leftover,” the trader opined.

The preferreds finished at $24.57, off 23 cents.

In the secondary, Bank of America Corp.’s floating-rate series E noncumulative preferreds (NYSE: BACPE) dominated overall trading. The preferreds were weakening with the market, falling 66 cents, or 2.51%, to $25.60.

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