Realty Income gets amended $3.25 billion unsecured credit facility

By Sarah Lizee

Olympia, Wash., Oct. 24 – Realty Income Corp. closed on an amended $3.25 billion unsecured credit facility, according to a press release.

The amended credit facility is comprised of a $3 billion unsecured revolving credit facility that replaces the company’s existing $2 billion unsecured credit facility and a new $250 million unsecured term loan due March 2024.

In addition, the company’s existing $250 million unsecured term loan due June 2020 will remain outstanding under the amended credit agreement.

The capacity of the unsecured revolving credit facility can be increased to $4 billion with the accordion expansion feature.

The revolver matures in March 2023 and includes two six-month extensions that can be exercised at the company's option.

Under the revolving credit facility, the company’s current A-/A3 credit ratings provide for a borrowing rate of Libor plus 77.5 basis points with a facility commitment fee of 12.5 bps, for all-in drawn pricing of 90 bps over Libor, compared to all-in drawn pricing of 97.5 bps over Libor under the previous facility.

Borrowings under the new term loan due 2024 bear interest at Libor plus 85 bps, based on the current credit rating. In conjunction with the new term loan, the company also entered into an interest rate swap which fixes the per annum interest rate at 3.89%.

A total of 23 lenders are participating in the credit facility, including Wells Fargo Bank as the administrative agent.

Wells Fargo Securities, LLC, Merrill Lynch, Pierce, Fenner & Smith Inc., RBC Capital Markets, JPMorgan Chase Bank, NA and Regions Bank are joint lead arrangers for the revolver, with Bank of America, NA, Royal Bank of Canada, JPMorgan and Regions Bank as co-syndication agents and Barclays Bank plc, Goldman Sachs Bank USA, Mizuho Bank, Ltd., Morgan Stanley Bank, NA and U.S. Bank NA as co-documentation agents.

Wells Fargo, Regions Bank, U.S. Bank, Bank of New York Mellon, Branch Banking and Trust Co. and PNC Capital Markets LLC are joint lead arrangers for the new term loan, with Regions Bank, U.S. Bank and Bank of New York Mellon, Branch Banking as co-syndication agents.

Other participants in the new credit facility include Bank of Nova Scotia, BMO Harris Bank NA, Citibank, NA, Citizens Bank, NA, Credit Suisse AG, Cayman Islands Branch, TD Bank, NA, MUFG Union Bank, NA, UBS AG, Stamford Branch, Associated Bank, NA and Comerica Bank.

The real estate investment trust for retail and commercial properties is based in Escondido, Calif.

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