NEW YORK CITY — Jones Lang LaSalle's Capital Markets team has closed a $275 million secured credit facility on behalf of Charter Hall Office REIT, which is secured by five office properties across the United States — 745 Atlantic Avenue in Boston; One & Three Christina Center in Delaware; Pasadena Towers in Pasadena; Promenade II in Atlanta; and SunTrust Financial Centre in Tampa.
The debt facility includes a $190 million five-year term loan for the assets, as well as an undrawn $85 million revolver facility to fund leasing-related expenditures at those properties.
Managing Director Paul House, executive vice president Matt Comfort and senior vice president Reid McGlamery led the Jones Lang LaSalle team on this transaction.
“The steady cash flow generated by the portfolio, coupled with exceptional sponsorship, made this an attractive financing opportunity,” said Matt Comfort, executive vice president, Jones Lang LaSalle. “The assets have a diverse, high-quality tenant base and are located in strategic markets that benefit from strong regional economies.”
The debt facility allows several advantages for Charter Hall Office’s assets. First, as a direct result, the REIT will be able to refinance the 2011 loan maturities at One & Three Christina Center and 745 Atlantic Avenue, without the need for additional equity.
In addition, Charter Hall Office will be able to improve its liquidity position through both the undrawn $85 million revolver facility and by releasing approximately $88 million of net proceeds to the REIT (after the repayment of the One & Three Christina Center and 745 Atlantic Avenue loans).
“The facility enhanced our capital position, and access to the revolver facility ensures these five properties remain competitively positioned in the leasing market,” said Adrian Taylor, chief executive officer of Charter Hall Office REIT.
The REIT also will increase its overall United States weighted average debt maturity from 3.3 years to 3.9 years, and the average drawn all-in-cost for the U.S. debt facilities will drop from 5.6 percent (as of December 2010) to approximately 5.2 percent. Finally, all of the REIT’s assets are now financed in their local jurisdiction, which also increases the natural capital hedged.
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Jones Lang LaSalle also announced today that its Capital Markets team secured a $27 million senior mortgage loan for LaSalle Investment Management to finance the acquisition of The Shade at Desert Ridge in Phoenix. The 342-unit multifamily property consists of 14 two- and three-story buildings. Built in 2006, the property is located at 21150 N. Tatum Blvd. in the North Phoenix submarket. It is currently 96 percent occupied.
The property was purchased in an all-cash transaction by LaSalle Investment in September 2010, and the new non-recourse, fixed-rate loan with flexible pre-payment options was arranged through an affiliate of Hartford Investment Management Company.
— Dan Marcec