DENVER-Locally based Archstone-Smith, one of the largest apartment real estate investment trusts in the US, in a recent Securities and Exchange Commission filing, says it plans to issue about $200 million in bonds. The notes will carry a 5.25% interest rate and are due in 2010.

Interest on the notes is payable on June 1 and Dec. 1 of each year, beginning on June 1, 2006. The notes will mature on Dec. 1, 2010. Archstone-Smith may redeem some or all of the notes at any time and from time to time. Interest will start to accrue today, Nov. 29.

The net proceeds from the sale of the notes are expected to be approximately $197.95 million, after deducting underwriting discounts and our offering expenses. The net proceeds will be used to repay a portion of the borrowings under the REIT's unsecured revolving credit facilities.

The approximately $200 million in notes will be senior unsecured obligations of Archstone-Smith. It will not be subject to a sinking fund and will not be convertible or exchangeable into other securities. The notes will rank equally with all of its other unsecured senior indebtedness.

The Banc of America and Citigroup are the joint managers. The senior co-managers are JP Morgan, Lehman Brothers and Morgan Stanley. The co-managers are Deutsche Bank Securities, RBS Greenwich Capital, Sun Trust Robinson Humphrey and Wedbush Morgan Securities Inc.

"We currently have $700 million in total borrowing capacity under these unsecured credit facilities, with approximately $412.7 million outstanding and an available balance of approximately $256.4 million," according to the prospectus filed with the SEC. "Amounts repaid under the unsecured credit facilities may be reburied and we expect to make additional borrowings under the unsecured credit facilities following this offering for the development and acquisition of apartment communities and for working capital purposes. Under a competitive bid option, we may be able to borrow up to $300 million at a lower interest rate depending on market conditions."

The company's $600-million unsecured credit facility, which is led by JPMorgan Chase Bank, N.A., an affiliate of one of the underwriters, bears interest at the greater of the prime rate or the federal funds rate plus 0.5% or, at Archstone-Smith's option, Libor plus 0.5%, which is currently 4.37%.

The credit facility is scheduled to mature in December 2007 but may be extended for one year at the company's option. The REIT also has a $100-million short-term credit facility is with JPMorgan Chase Bank, N.A. and bears interest at the rate agreed among the parties at the time of a borrowing, which is currently a weighted average of 4.35%. In addition to JPMorgan Chase Bank, N.A., affiliates of certain of the other underwriters also participate in its credit facilities.

Archstone-Smith owns or has an ownership interest in 253 apartment communities, representing 86,937 units. As of Sept. 30, the company has about $2.3 billion of unsecured long-term debt. All of its debt, including debt of its consolidated subsidiaries, is approximately $5 billion.