Retail Properties of America, Inc. (NYSE:RPAI) Files An 8-K Entry into a Material Definitive AgreementItem 1.01
| Item 1.01 | Creation of Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant |
On April23, 2018, Retail Properties of America, Inc. (the “Company”) amended and restated its existing credit agreement (the “Existing Credit Agreement”) with a number of financial institutions to provide for an unsecured credit facility in the aggregate amount of $1,100,000,000, consisting of an $850,000,000 unsecured revolving line of credit and a $250,000,000 unsecured term loan (together, the “Facility”). The Facility replaces the Company’s previous $1,200,000,000 unsecured credit facility. The Company has the ability to increase the available borrowings under the Facility (the revolving or term portion) by up to $500,000,000, for a total aggregate potential Facility size of $1,600,000,000. The Facility contains customary representations, warranties and covenants, and events of default, which are substantially similar to those under the previous facility.
The unsecured revolving line of credit under the Facility bears interest at a rate per annum equal to London Interbank Offered Rate (LIBOR) or the alternative base rate, plus a margin of between 1.05% and 1.50% (compared to 1.35% and 2.25% under the Existing Credit Agreement) based on the Company’s leverage ratio as calculated under the Facility, or a margin of between 0.825% and 1.55% (compared to 0.85% and 1.55% under the Existing Credit Agreement) based on a pricing grid that is based on the Company’s investment grade credit, respectively, plus a facility fee of between 0.15% and 0.30% (compared to an unused facility fee of between 0.15% and 0.25% depending on the amount of borrowings outstanding to the Existing Credit Agreement) based on the Company’s leverage ratio as calculated under the Facility, or between 0.125% and 0.30% (which is the same as under the Existing Credit Agreement) based on a pricing grid that is based on the Company’s investment grade credit, respectively. The unsecured term loan under the Facility bears interest at a rate per annum equal to LIBOR or the alternative base rate, plus a margin of between 1.20% and 1.70% (compared to 1.30% and 2.20% under the Existing Credit Agreement) based on the Company’s leverage ratio as calculated under the Facility, or a margin of between 0.90% and 1.75% (which is the same as under the Existing Credit Agreement) based on a pricing grid that is based on the Company’s investment grade credit, respectively. The Company may elect to irrevocably convert to the investment grade credit rating pricing grid at any time. Interest on amounts outstanding under the Facility is payable monthly.
The unsecured revolving line of credit matures on April22, 2022 (extended from January5, 2020 under the Existing Credit Agreement), which may be extended by the Company for two periods of six months each, subject to continued compliance with the terms of the Facility and the payment of an extension fee of 0.075% for each extension. The $250,000,000 unsecured term loan matures on January5, 2021 (the same maturity date as under the Existing Credit Agreement). The Company may repay outstanding principal amounts under the Facility at any time without penalty or premium, except for LIBOR breakage costs. Any unpaid principal amounts are due and payable upon maturity of the Facility.
Upon closing, the Company repaid in full the unsecured term loan that was scheduled to mature on May11, 2018 under the Existing Credit Agreement that had an outstanding balance of $100,000,000, and had outstanding the $250,000,000 unsecured term loan and $210,000,000 drawn on the unsecured revolving line of credit.
About Retail Properties of America, Inc. (NYSE:RPAI)
Retail Properties of America, Inc., formerly Inland Western Retail Real Estate Trust, Inc., is a real estate investment trust (REIT). The Company owns and operates shopping centers in the United States. The Company’s retail operating portfolio includes power centers, neighborhood and community centers, and lifestyle centers and predominantly multi-tenant retail mixed-use properties, as well as single-user retail properties. The Company owns approximately 200 retail operating properties representing approximately 28,930,000 square feet of gross leasable area (GLA). The Company owns properties in eastern division and western division of the United States. The Company’s eastern division consists of approximately 120 properties located in Alabama, Connecticut, Florida, Georgia, Indiana, Maine, Maryland, Massachusetts, Michigan, Missouri, New Jersey, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, South Carolina, Tennessee, Vermont and Virginia.