NEWTON, Mass.–(BUSINESS WIRE)–Industrial Logistics Properties Trust (Nasdaq: ILPT) today announced the closing of a $1.235 billion debt financing with a final maturity date of October 9, 2027. The financing is secured by a portfolio of 104 industrial properties containing approximately 18.6 million square feet in 31 states. As of June 30, 2022, the 104 properties were 96.8% occupied with a weighted average remaining lease term of approximately 10.5 years.
Concurrent with the closing of the debt financing, ILPT has fully repaid its $1.385 billion bridge loan maturing in February 2023 with proceeds from the financing and excess cash. The bridge loan was used by ILPT to finance the acquisition of Monmouth Real Estate Investment Corporation earlier this year.
The $1.235 billion debt financing includes a $1.1 billion mortgage and a $135 million mezzanine loan. The loans are five-year, interest-only, variable-rate loans with initial terms of two years and three one-year extension options, subject to the satisfaction of certain conditions, and bear a total weighted average interest rate of SOFR plus 3.93% per annum. . The ILPT purchased an interest rate cap limiting the SOFR to 2.25% until October 2024. The loans also allow part of the borrowings to be prepaid without penalty.
Yael Duffy, President and Chief Operating Officer of ILPT, issued the following statement:
“We are pleased to have completed this $1.235 billion debt financing under difficult market conditions. This debt financing enabled us to fully repay our $1.385 billion bridge loan maturing in February 2023 with debt with a final maturity date of October 2027 and excess cash. ILPT currently has no short-term debt maturities, but retains the flexibility to repay significant debt and reduce indebtedness in the future through prepayment options. This is important because we continue to evaluate strategies to strengthen ILPT’s balance sheet and reduce leverage.
The loan was provided by Citigroup, UBS Investment Bank, Bank of America, BMO Capital Markets and Morgan Stanley. Skadden, Arps, Slate, Meagher & Flom LLP provided legal advice to ILPT in this transaction.
Industrial Logistics Properties Trust (Nasdaq: ILPT) is a real estate investment trust, or REIT, focused on owning and leasing high-quality distribution and logistics properties that meet the growing needs of e-commerce. As of June 30, 2022, ILPT’s portfolio consisted of 412 properties containing approximately 59.7 million leasable square feet located in 39 states. More than 78.0% of ILPT’s annual rental income comes from investment-grade tenants, tenants that are affiliates of investment-rated entities, or land leases in Hawaii. ILPT is managed by The RMR Group (Nasdaq: RMR), a leading US alternative asset management firm with over $37 billion in assets under management as of June 30, 2022 and over 35 years of institutional experience in the purchase, sale, financing and operation of commercial real estate. ILPT is headquartered in Newton, MA. For more information, visit www.ilptreit.com.
CAUTION REGARDING FORWARD-LOOKING STATEMENTS
This press release contains statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws. Whenever the ILPT uses words such as “believe”, “expect”, “anticipate”, “intend”, “plan”, “estimate”, “will”, “may” and negatives or derivatives of these or similar expressions, the ILPT makes forward-looking statements. These forward-looking statements are based on ILPT’s current intention, beliefs or expectations, but the realization of forward-looking statements is not guaranteed and may not occur. Actual results may differ materially from those contained or implied by ILPT’s forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors, some of which are beyond ILPT’s control. For instance:
Ms Duffy says ILPT currently has no short-term debt maturities, but retains the flexibility to repay significant debt and reduce leverage in the future through prepayment options. However, economic and market conditions and unforeseen events may limit ILPT’s ability to use the collateral release and debt prepayment clauses.
Ms. Duffy said the ILPT continues to evaluate strategies to strengthen the ILPT’s balance sheet and reduce leverage. However, ILPT may choose not to pursue any of the strategies it evaluates and, as a result, ILPT may not be able to strengthen its balance sheet and reduce its leverage.
Information contained in ILPT’s filings with the Securities and Exchange Commission, or SEC, including under the heading “Risk Factors” in or incorporated into ILPT’s periodic reports, identifies important factors which could cause ILPT’s actual results to differ materially from those indicated or implied by ILPT’s forward-looking statements. Documents filed by the ILPT with the SEC are available on the SEC’s website at www.sec.gov.
You should not place undue reliance on forward-looking statements.
Except as required by law, ILPT does not intend to update or modify any forward-looking statements as a result of new information, future events or otherwise.
A Maryland Real Estate Investment Trust with Nasdaq-listed beneficial interest transferable shares.
No shareholder, trustee or officer is personally liable for any act or obligation of the Trust.