BETHESDA, MD—Hospitality REIT RLJ Lodging Trust has closed on a $150 million unsecured seven-year term loan facility that will be deployed by the end of the second quarter of 2015.
This transaction will address all of RLJ's debt maturities for the year, says CEO Thomas J. Baltimore, Jr. The facility also positions the REIT's balance sheet to pursue additional growth opportunities, he added.
The term loan has a delayed funding feature, allowing RLJ Lodging to draw funds once the prepayment windows for its 2015 CMBS debt maturities become available. The term loan should be fully drawn by the end of the second quarter of 2015. Once completed, RLJ's unencumbered asset pool will increase to 137 assets, which will represent almost 85% of its 2014 pro forma Hotel EBITDA.
The interest rate is based on a pricing grid tied to the company's leverage ratio and bears a floating interest rate of LIBOR plus 180 basis points to 260 basis points. The term loan also has an accordion option which provides the company with the ability to upsize the facility to $250 million.
RLJ's next tranche of debt will mature in 2017.
© Touchpoint Markets, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more inforrmation visit Asset & Logo Licensing.
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.
