Rouse Properties plans $433.5 million three-year term loan for spinoff

By Susanna Moon

Chicago, Dec. 20 - Rouse Properties, Inc. will be spun off from General Growth Properties, Inc. with about $1.16 billion of debt outstanding, including a new three-year senior secured term loan of about $433.5 million.

The senior secured term loan will be provided by a syndicate of lenders with Wells Fargo Bank, NA as administrative agent, according to a press release by General Growth. Wells Fargo Securities, LLC, RBC Capital Markets, LLC and U.S. Bank NA are the joint lead arrangers.

The senior secured facility also includes a $50 million revolving credit facility.

Rouse Properties' total debt after the spinoff also includes about $724 million of existing mortgage debt, and the weighted average interest rate for all of the debt is about 5.6%.

In addition, Rouse Properties finalized the terms of a 3.5-year subordinated unsecured revolving credit facility with an affiliate of Brookfield Asset Management, Inc., which will provide borrowings on a revolving basis of up to $100 million.

General Growth said Tuesday that its board of directors approved the spinoff of its subsidiary Rouse, which will be completed on Jan. 12 through a pro rata taxable dividend of voting common stock of Rouse Properties held by General Growth to its stockholders of record as of the close of business on Dec. 30.

Rouse is a subsidiary of General Growth Properties, Inc., a Chicago-based real estate investment trust that owns regional shopping malls, master planned community developments and commercial office buildings.

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