ESR-Reit Priced S$125 Million in Subordinated Perpetual Securities
ESR-Reit Issues S$125 Million in Subordinated Perpetual Securities
ESR-Reit, a Singaporean real estate investment trust, has priced S$125 million in subordinated perpetual securities at 5.75% under its S$750 million multicurrency debt issuance programme. The securities will be issued on March 20, 2023.
Net Proceeds to Refinance or Repay Existing Borrowings
The net proceeds arising from the issue of the securities will be used to refinance or repay existing borrowings or to finance or refinance ESR-Reit’s acquisitions and investments, or for asset enhancement works, working capital, and capital expenditure required, according to the Reit’s manager.
Joint Lead Managers
DBS and OCBC will be joint lead managers for the issue.
Investment Terms
Holders of the perpetual securities will receive distributions in arrears and may redeem the securities on the first reset date of March 20, 2030, or any distribution payment date falling after the first reset date. The distribution rate will be reset on the first reset date and every five years thereafter.
Distribution Rate Reset
The distribution rate will be reset on the first reset date and every five years thereafter at a rate equal to the Singapore Overnight Rate Average Overnight Indexed Swap plus the initial spread of 3.512%. The distribution will be paid twice a year.
Conclusion
ESR-Reit’s successful pricing of S$125 million in subordinated perpetual securities demonstrates its ability to access the capital markets and manage its debt effectively. The proceeds from this issue will be used to strengthen the Reit’s financial position and support its growth plans.
Frequently Asked Questions
Q: What is the face value of the perpetual securities?
A: S$125 million
Q: What is the coupon rate of the perpetual securities?
A: 5.75%
Q: What is the first reset date for the perpetual securities?
A: March 20, 2030
Q: How often will the distribution be paid?
A: Twice a year
Q: Who are the joint lead managers for the issue?
A: DBS and OCBC
Q: What will be the use of the net proceeds from the issue of the securities?
A: The net proceeds will be used to refinance or repay existing borrowings or to finance or refinance ESR-Reit’s acquisitions and investments, or for asset enhancement works, working capital, and capital expenditure required.
