Ventas Closes $3B Credit Facility

CHICAGO-Healthcare REIT Ventas Inc. has closed a new $3-billion unsecured credit facility, the company said Tuesday. The facility, which VTR obtained through subsidiary Ventas Realty Limited Partnership, includes a $500-million “accordion feature” that permits the company to expand its borrowing capacity to $3.5 billion.

The credit facility is comprised of a $2-billion revolving credit facility initially priced at 100 basis points over LIBOR, and a $200 million four-year term loan and an $800 million five-year term loan, each initially priced at 105 bps over LIBOR. The revolving credit facility matures in January 2018 and can be extended for an additional year at VTR's option, while the term loans mature in January '18 and January 2019, respectively.

Proceeds of the new facility were used to repay outstanding debt under the company's previous $2-billion unsecured facility, along with $680 million in term loans scheduled to mature between 2015 and '18. “Ventas's successful completion of our new credit facility reduces our debt costs and enhances our liquidity, so that we can continue to grow and perform,” says Debra A. Cafraro, VTR's chairman and CEO.

She cites the REIT's “strong balance sheet, consistent superior performance, growing cash flows and credit ratings improvements” as keys to the success of the new facility. (Click here for a Real Estate Forum profile of Cafaro and her mentor, board member Shelli Rosenberg.)

Merrill Lynch and J.P. Morgan Securities LLC were the joint bookrunners for the credit facility. Bank of America, N.A. is serving as the administrative agent, and JPMorgan Chase Bank acted as the syndication agent.

Along with Merrill Lynch and J.P. Morgan Securities, other joint lead arrangers included Barclays Capital, Citigroup Global Markets, Credit Agricole Corporate and Investment Bank, RBC Capital Markets, the Toronto Dominion Bank and UBS Securities. Barclays Bank PLC, Citibank N.A., Credit Agricole, Royal Bank of Canada, TD Bank and UBS Securities all served as co-documentation agents for the credit facility.

This past October, VTR reported an 8% year-over-year increase in its third-quarter funds from operations. Normalized FFO per diluted common share was a record $1.04 for the quarter ended Sept. 30, compared to $0.96 the year prior.