WASHINGTON, DC-DuPont Fabros Technology will find out this weekif the underwriters to its public offering of 7 million shares willexercise their overallotment option. If they do, the REIT stands torealize $194.4 million in proceeds, Mark Wetzel, CFO and Treasurertells GlobeSt.com. If not, it will take home $169 million.


Last week it priced the shares of preferred stock at $25 pershare, giving underwriters a 30-day option to purchase anadditional 1,050,000.


The company intends to use all of the net proceeds from thisoffering, plus a portion of its available cash balances, to pay offits loan for its ACC4 data center. That loan has an outstandingbalance of $196.5 million. It then intends to use its remainingcash balances together with the amounts available under its $100million revolving credit facility, which is still open, to completethe current projects under development.


DuPont Fabros has found the capital markets open to itsoffering, Wetzek says. “There are three buckets you can basicallychase. One is pure unsecured debt, which we didn’t want to do.Another is raising more stock in the common equity market, which wealreadydid this year and we did feel we could do it again.But we felt the permanent capital made the most sense for us rightnow.”

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Erika Morphy

Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.