Italian REIT Beni Stabili said on Monday that it has tapped the financial market for €300 mln with the issue of an unsecured bond with a maturity of seven years.
The bond carries a fixed coupon of 1.625%, which is ‘significantly below the company’s average cost of debt’, the listed office giant said.
The notes, which were rated BBB- by S&P Global, were priced at a spread of 115 basis points over the reference swap rate. They oversubscribed by about seven times, with total orders surpassing the €2 bn mark.
‘This is a key milestone which confirms the recognition of the company’s strong fundamentals as a true European REIT,’ commented Beni Stabili, the Italian arm of French property group Foncière des Régions.
The transaction is part of Beni Stabili’s strategy to diversify its funding sources while extending its average debt maturity and reducing its cost of debt.
Banca IMI, BNP Paribas, Crédit Agricole Corporate and Investment Bank, Société Générale Corporate & Investment Banking and UniCredit Bank acted as Joint Lead Managers.
Unsecured corporate bonds are proving an attractive financing strategy as fixed income investors seek exposure to higher yielding assets. In the past few weeks, German listed residential property owner Deutsche Wohnen also announced plans to issue €800 mln of convertible bonds.
Due in 2026, the bonds will offer a conversion premium of 40% to 45% above the reference share price and a coupon of 0.10% to 0.60%.
Similarly, Austrian listed property firm CA Immobilien Anlagen announced plans to issue a senior, unsecured bond with a total size of €200 mln. The CEE-focused property investor said it intends to use the net proceeds of the issue to optimise its financing structure including the early repayment of bank loans in CEE as well as for other general corporate purposes.
The convertible bonds will have a maturity of 7.5 years and will offer a coupon of between 0.50% - 1.00% per annum. They will be issued at 100% of their nominal value of €100,000 and will be redeemed, if not previously converted, at 100% of the nominal value.
In September CPI Property Group, a CEE-focused investment and development company majority owned by Czech billionaire Radovan Vitek, announced plans to issue a senior unsecured bond with a medium-term maturity and a total size of €1.25 bn.
