BETHESDA, MD-RLJ Lodging Trust, a local REIT, has completed a $700-million unsecured credit facility that is expandable to $1.2 billion. The facility consists of a five-year and a seven-year unsecured term loan for an aggregate amount of $400 million and a $300 million unsecured revolving line of credit.

The new facility replaces RLJ’s existing revolver at a lower interest rate, securing for the REIT savings of approximately $8 million to $10 million next year. The interest rates are based on a pricing grid tied to the company’s leverage ratio, resulting in blended term loan pricing that was more than 300 basis points lower than the 5.8% weighted average interest rate of the loans that were paid off.

The REIT is using the proceeds to pay down $70 million of the outstanding $85 million on its facility and retire four secured mortgage loans, which total approximately $330 million. These loans were secured by the DoubleTree by Hilton Metropolitan New York City.

Besides strengthening its balance sheet, the new facilities will help the company reach investment-grade status, says Thomas J. Baltimore Jr., president and CEO, in a prepared statement.

“We received considerable interest during the syndication process and were significantly over subscribed,” added CFO Leslie Hale. “We had a 100% participation from all of our existing lenders and added several new banks.”

The company has been steadily acquiring assets around the country over the past year, in some cases expanding its footprint into new markets. In June, it acquired the 278-room Hilton Garden Inn San Francisco Oakland/Bay Bridge for $36.2 million, or approximately $130,000 per key—entering the Bay market for the first time.

More recently, earlier this month it acquired the 275-room Embassy Suites Boston/Waltham via an off-market transaction, for $64.5 million, or approximately $235,000 per key. The company purchased this hotel, it’s first in Boston, with cash from its balance sheet. In May RLJ acquired two focused-service hotels, the 226-room Courtyard New York Manhattan/Upper East Side and the 187-room Residence Inn by Marriott Bethesda Hotel Downtown, for a combined total of $146.5 million.