Realty Income pricing adds to record August of nearly $90 billion of new issues

By Andrea Heisinger

Omaha, Aug. 30 - Realty Income Corp. priced an upsized $550 million in 6.75% 12-year notes Thursday in what traders said was the only new issue of the day.

The notes priced at a spread of Treasuries plus 225 basis points with a price of 99.827 and yield of 6.772%.

The offering was upsized from $250 million, a source said.

"I didn't expect much more than that for the day," a market source said of the thin volume of new issues.

Wednesday's issue from Caterpillar Financial Services Corp. of $400 million in 5.85% medium-term notes was trading 2 bps tighter Thursday, a market source said. The notes priced at a spread of Treasuries plus 130 bps.

The month is closing in on $90 billion in new issues, a source said, which would make it a record August.

"I think the closest it's come is $57 billion, so this is far and away the record August of all time," the source said.

Sources again predicted Thursday that there would be no more issues for the week with Friday's early market close and companies waiting until September to price.

"We're going to see a lot more come to the market in September," a market source said, citing a backlog from companies waiting to issue.

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