Alstria office REIT announced on Friday that it has completed two debt refinancings totalling around EUR 76 mln. Of this amount, EUR 68 mln has been used to repay the main syndicated loan. The remaining EUR 8 mln is a CAPEX line which will be used for the funding of an ongoing refurbishment, the company said in a press release.
Alstria office REIT announced on Friday that it has completed two debt refinancings totalling around EUR 76 mln. Of this amount, EUR 68 mln has been used to repay the main syndicated loan. The remaining EUR 8 mln is a CAPEX line which will be used for the funding of an ongoing refurbishment, the company said in a press release.
The two new credit facilities, provided by two unnamed German financiers, have been secured on a non-recourse basis with a five-year maturity. The average cost of debt of the two new credit facilities comes to 3.3%, reducing the company´s overall cost of debt to 4.4% from 4.8%. The properties securing the loans are located in Hamburg, Mannheim, and Wiesbaden and have a weighted average lease length of 11.4 years.
The refinancing is aimed at managing the overall balloon payment of the company´s main facility which matures at end-2011. The strategy includes the renegotiation of the LTV covenants which occurred in the first quarter 2009, selected assets sales, and selected non-recourse financing of assets.
'These two new deals reflect the implementation of Alstria’s strategy set up in summer 2007,' noted Alstria CEO Olivier Elamine. 'Since then, we have paid off almost 20% of our main syndicated loan facility from new non-recourse loans and selected asset sales. In line with our belief that deleveraging can be highly value destructive if executed too fast using radical measures like capital increases, we are strengthening our balance sheet step by step, safeguarding our shareholder value in the process.'
He said Alstria had been able to achieve the refinancing at optimal conditions with multiple lenders, adding this 'demonstrates the strength of our assets, and the quality of the underlying cash flow. We are convinced that, coupled with selected asset disposals, this is the right way to prepare the company for future opportunities that will arise in the market.'
Alstria is an internally managed Real Estate Investment Trust (REIT) which is solely focused on acquiring, owning and managing office real estate in
Germany. Its current portfolio comprises 89 properties with a total lettable area of approximately 943,000 m2 and valued at approximately EUR 1.8 bn.
