Granite REIT Announces C$300 Million Offering of Senior Unsecured Debentures
Granite REIT announced that its subsidiary Granite REIT Holdings Partnership has priced a C$300 million offering of Series 10 senior unsecured debentures. The debentures will bear interest at Daily Compounded CORRA plus 0.77% per annum, payable quarterly, and will mature on December 11, 2026.
The offering is expected to close around February 4, 2025, subject to conditions including a Morningstar DBRS credit rating of 'BBB (high)' or higher. The debentures will be guaranteed by Granite and Granite REIT Inc.
The net proceeds will be used to repay Granite LP's C$300 million senior unsecured non-revolving term facility maturing December 11, 2026. Through an existing cross currency interest rate swap, Granite LP has converted the Canadian dollar principal and floating rate payments to Euro denominated principal with fixed interest payments at an effective rate of 0.27%.
Granite REIT ha annunciato che la sua controllata Granite REIT Holdings Partnership ha fissato il prezzo di un'emissione di C$300 milioni di obbligazioni senior non garantite di Serie 10. Le obbligazioni porteranno un interesse pari a CORRA composto giornalmente più lo 0,77% all'anno, pagabile trimestralmente, e scadranno l'11 dicembre 2026.
L'offerta è prevista per la chiusura intorno al 4 febbraio 2025, soggetta a condizioni che includono un rating di credito Morningstar DBRS di 'BBB (alto)' o superiore. Le obbligazioni saranno garantite da Granite e Granite REIT Inc.
I proventi netti saranno utilizzati per rimborsare il prestito senior non garantito a termine di C$300 milioni di Granite LP in scadenza l'11 dicembre 2026. Attraverso uno swap di tasso di interesse su valuta incrociata esistente, Granite LP ha convertito il capitale in dollari canadesi e i pagamenti a tasso variabile in capitale denominato in Euro con pagamenti di interesse fissi a un tasso effettivo dello 0,27%.
Granite REIT anunció que su subsidiaria Granite REIT Holdings Partnership ha fijado el precio de una oferta de C$300 millones de bonos senior no garantizados de Serie 10. Los bonos devengarán interés al CORRA compuesto diariamente más el 0.77% anual, pagadero trimestralmente, y vencerán el 11 de diciembre de 2026.
Se espera que la oferta se cierre alrededor del 4 de febrero de 2025, sujeta a condiciones que incluyen una calificación crediticia de Morningstar DBRS de 'BBB (alto)' o superior. Los bonos estarán garantizados por Granite y Granite REIT Inc.
Los ingresos netos se utilizarán para reembolsar la línea de crédito senior no garantizada de C$300 millones de Granite LP con vencimiento el 11 de diciembre de 2026. A través de un swap de tasa de interés de divisas existente, Granite LP ha convertido el capital en dólares canadienses y los pagos a tasa variable en capital denominado en euros con pagos de intereses fijos a una tasa efectiva del 0.27%.
Granite REIT은 자회사 Granite REIT Holdings Partnership이 C$300 백만 규모의 10번 시리즈 senior unsecured debentures의 가격을 책정했다고 발표했습니다. 이 채권은 연간 0.77%의 Daily Compounded CORRA 이자를 지급하며, 분기별로 지급되고, 2026년 12월 11일에 만기가 됩니다.
이번 공모는 2025년 2월 4일경에 종료될 것으로 예상되며, Morningstar DBRS 신용 등급이 'BBB (high)' 이상일 경우에 한합니다. 이 채권은 Granite 및 Granite REIT Inc.의 보증이 있습니다.
순수익은 Granite LP의 300백만 달러 규모의 senior unsecured non-revolving term facility를 갚는 데 사용될 것입니다. 기존의 cross currency interest rate swap를 통해 Granite LP는 캐나다 달러의 원금과 변동 금리 지급을 고정 금리 지급이 적용된 유로로 전환했습니다. 유효 금리는 0.27%입니다.
Granite REIT a annoncé que sa filiale Granite REIT Holdings Partnership a fixé le prix d'une émission de 300 millions de C$ d'obligations senior non garanties de Série 10. Les obligations porteront un intérêt au CORRA composé quotidiennement plus 0,77 % par an, payable trimestriellement, et arriveront à échéance le 11 décembre 2026.
L'émission devrait se clore autour du 4 février 2025, sous réserve de conditions incluant une note de crédit Morningstar DBRS de 'BBB (haut)' ou supérieure. Les obligations seront garanties par Granite et Granite REIT Inc.
Le produit net sera utilisé pour rembourser la facilité de crédit senior non garantie et non renouvelable de 300 millions de C$ de Granite LP qui arrive à échéance le 11 décembre 2026. Grâce à un swap de taux d'intérêt en devises existant, Granite LP a converti le principal en dollars canadiens et les paiements d'intérêts variables en principal libellé en euros avec des paiements d'intérêts fixes à un taux effectif de 0,27 %.
Granite REIT hat bekannt gegeben, dass ihre Tochtergesellschaft Granite REIT Holdings Partnership ein Angebot über C$300 Millionen für 10. Serie Senior Unsecured Debentures bepreist hat. Die Anleihen werden jährlich an Daily Compounded CORRA plus 0,77% Zinsen tragen, zahlbar vierteljährlich, und laufen am 11. Dezember 2026 ab.
Das Angebot wird voraussichtlich am 4. Februar 2025 abgeschlossen, vorbehaltlich von Bedingungen, einschließlich einer Morningstar DBRS Kreditbewertung von 'BBB (hoch)' oder höher. Die Anleihen werden von Granite und Granite REIT Inc. garantiert.
Die Nettoerlöse werden verwendet, um die Senior Unsecured Non-Revolving Term Facility von Granite LP in Höhe von C$300 Millionen zurückzuzahlen, die am 11. Dezember 2026 fällig ist. Durch einen bestehenden Cross Currency Interest Rate Swap hat Granite LP die Kapitalbeträge in kanadischen Dollar und die variablen Zinszahlungen in Euro mit festen Zinszahlungen zu einem effektiven Zinssatz von 0,27% umgewandelt.
- Refinancing existing debt at favorable terms with effective fixed interest rate of 0.27%
- Maintaining same debt maturity timeline (December 11, 2026)
- Currency risk hedged through cross currency interest rate swap
- Taking on new debt to refinance existing debt without reducing leverage
Insights
This C$300 million debenture offering by Granite REIT represents a sophisticated financial engineering move that warrants attention. The structure effectively maintains their existing debt profile while introducing several strategic advantages:
The replacement of the term loan with floating-rate CORRA-based debentures, combined with a cross-currency swap into Euros at 0.27% fixed rate, is particularly noteworthy. This arrangement provides multiple benefits:
- Interest rate risk mitigation through the swap mechanism
- Natural hedge for their European real estate portfolio
- Potential cost savings given the current interest rate environment
The BBB (high) rating requirement from Morningstar DBRS as a closing condition signals strong credit quality and should ensure favorable pricing. The private placement approach in Canadian provinces suggests targeted institutional interest, potentially leading to a stable, long-term investor base.
Most importantly, this refinancing maintains Granite's financial flexibility without increasing their debt burden, while potentially reducing their effective borrowing costs. The timing appears strategic, allowing them to lock in rates before potential market shifts while maintaining their existing maturity profile through 2026.
NOT FOR DISTRIBUTION TO
The Debentures are being offered on an agency basis by a syndicate of agents co-led by Scotia Capital, TD Securities and Desjardins Securities. It is a condition of closing that Morningstar DBRS assign a credit rating of “BBB (high)” with a stable trend or higher relating to the Debentures.
The Offering is being made on a private placement basis in each of the provinces and territories of
Granite LP intends to use the net proceeds from the Offering to repay in full its
Through an existing cross currency interest rate swap, Granite LP has exchanged the Canadian dollar denominated principal and floating rate interest payments related to the Debentures for Euro denominated principal and fixed interest payments, resulting in an effective fixed interest rate of
This press release does not constitute an offer to sell or the solicitation of an offer to buy the Debentures in any jurisdiction in which such offer, solicitation or sale would be unlawful.
ABOUT GRANITE
Granite is a Canadian-based REIT engaged in the acquisition, development, ownership and management of logistics, warehouse and industrial properties in
OTHER INFORMATION
Copies of financial data and other publicly filed documents about Granite are available through the internet on SEDAR+ which can be accessed at www.sedarplus.ca and on the United States Securities and Exchange Commission’s Electronic Data Gathering, Analysis and Retrieval System (EDGAR) which can be accessed at www.sec.gov.
This press release shall not constitute an offer to sell or the solicitation of an offer to buy securities in
For further information, please see our website at www.granitereit.com or contact Teresa Neto, Chief Financial Officer, at 647-925-7560 or Andrea Sanelli, Senior Director, Legal & Investor Services, at 647-925-7504.
FORWARD LOOKING STATEMENTS
This press release may contain statements that, to the extent they are not recitations of historical fact, constitute “forward-looking statements” or “forward-looking information” within the meaning of applicable securities legislation, including the United States Securities Act of 1933, as amended, the United States Securities Exchange Act of 1934, as amended, and applicable Canadian securities legislation. Forward-looking statements and forward-looking information may include, among others, statements regarding the expected closing date of the Offering, the use of the net proceeds of the Offering, the expected final credit rating for the Debentures, and Granite’s plans, goals, strategies, intentions, beliefs, estimates, costs, objectives, economic performance, expectations, or foresight or the assumptions underlying any of the foregoing. Words such as “may”, “would”, “could”, “will”, “likely”, “expect”, “anticipate”, “believe”, “intend”, “plan”, “forecast”, “project”, “estimate”, “seek”, “objective” and similar expressions are used to identify forward-looking statements and forward-looking information. Forward-looking statements and forward-looking information should not be read as guarantees of the expected closing date of the Offering, the use of the net proceeds of the Offering, the expected final credit rating for the Debentures, or other events, performance or results and will not necessarily be accurate indications of whether or the times at or by which future events or performance will be achieved. Undue reliance should not be placed on such statements. Forward-looking statements and forward-looking information are based on information available at the time and/or management’s good faith assumptions and analyses made in light of its perception of historical trends, current conditions and expected future developments, as well as other factors management believes are appropriate in the circumstances, and are subject to known and unknown risks, uncertainties and other unpredictable factors, many of which are beyond Granite’s control, that could cause actual events or results to differ materially from such forward-looking statements and forward-looking information. Important factors that could cause such differences include, but are not limited to, the risks set forth in the annual information form of Granite Real Estate Investment Trust and Granite REIT Inc. dated February 28, 2024 (the “Annual Information Form”) and management’s discussion and analysis of results of operations and financial position for the three and nine month periods ended September 30, 2024 (“Q3 MD&A”). The “Risk Factors” section of the Annual Information Form and the “Risks and Uncertainties” section of the Q3 MD&A also contain information about the material factors or assumptions underlying such forward-looking statements and forward-looking information. Forward-looking statements and forward-looking information speak only as of the date the statements and information were made and unless otherwise required by applicable securities laws, Granite expressly disclaims any intention and undertakes no obligation to update or revise any forward-looking statements or forward-looking information contained in this press release to reflect subsequent information, events or circumstances or otherwise.
View source version on businesswire.com: https://www.businesswire.com/news/home/20250130739171/en/
Teresa Neto, Chief Financial Officer
647-925-7560
or
Andrea Sanelli, Senior Director, Legal & Investor Services
647-925-7504
Source: Granite Real Estate Investment Trust
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