Retail Properties Of America, Inc. Prices $400.0 Million Offering Of Senior Unsecured Notes

Rhea-AI Summary

Retail Properties of America, Inc. (NYSE: RPAI) has announced the pricing of a $400.0 million public offering of 4.750% senior unsecured notes due September 15, 2030, priced at 98.684% of par. The offering will close on August 25, 2020, subject to customary conditions. Proceeds will be used to repay existing debt, including a $250.0 million term loan due 2021 and borrowings under an $850.0 million line of credit, as well as for general business purposes. The offering is managed by Citigroup, Wells Fargo, Jefferies, KeyBanc, and U.S. Bancorp.

Positive

• The company aims to use the $400.0 million from the notes offering to repay significant debt, improving its financial position.
• Refinancing existing debt may enhance cash flow and lower interest expenses moving forward.

Negative

• The issuance of new debt could indicate existing financial pressures within the company.

OAK BROOK, Ill., Aug. 18, 2020 /PRNewswire/ -- Retail Properties of America, Inc. (NYSE: RPAI) (the "Company") announced today that it has agreed to sell $400.0 million aggregate principal amount of 4.750% senior unsecured notes due 2030 (the "Notes") in an underwritten public offering. The Notes were priced at 98.684% of par. The Notes will mature on September 15, 2030, unless earlier redeemed. The offering is expected to close on August 25, 2020, subject to customary closing conditions.

The Company intends to use the net proceeds from the sale of the Notes for the repayment of debt, including the repayment of its $250.0 million unsecured term loan due 2021 and outstanding borrowings under its $850.0 million unsecured revolving line of credit, and for general business purposes.

Citigroup Global Markets Inc., Wells Fargo Securities, LLC, Jefferies LLC, KeyBanc Capital Markets Inc. and U.S. Bancorp Investments, Inc. are acting as joint book-running managers for this offering.

This offering is being made pursuant to an effective shelf registration statement filed with the Securities and Exchange Commission and only by means of a prospectus and related prospectus supplement. Copies of these documents may be obtained by contacting Citigroup Global Markets Inc., c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, telephone: (800) 831-9146 or email: prospectus@citi.com or Wells Fargo Securities, LLC, 608 2nd Avenue South, Suite 1000, Minneapolis, MN 55402 Attn: WFS Customer Service, telephone: (800) 645-3751 or email: wfscustomerservice@wellsfargo.com.   

This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities nor shall there be any sale of these securities in any jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.

ABOUT RPAI 
Retail Properties of America, Inc. is a REIT that owns and operates high quality, strategically located open-air shopping centers, including properties with a mixed-use component. As of June 30, 2020, the Company owned 102 retail operating properties in the United States representing 20.0 million square feet. The Company is publicly traded on the New York Stock Exchange under the ticker symbol RPAI.

FORWARD-LOOKING STATEMENTS 
This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are subject to the safe harbors created thereby. These forward-looking statements reflect the Company's current views about its plans, intentions, expectations, strategies and prospects, which are based on the information currently available to the Company and on assumptions it has made. Although the Company believes that its plans, intentions, expectations, strategies and prospects as reflected in or suggested by those forward-looking statements are reasonable, the Company can give no assurance that such plans, intentions, expectations or strategies will be attained or achieved. Furthermore, actual results may differ materially from those described in the forward-looking statements and will be affected by a variety of risks and factors that are beyond the Company's control, including, without limitation, that the closing of the aforementioned offering is subject to, among other things, the Company's ability to satisfy the closing conditions to the pending transaction described above and the factors included in the Company's Annual Report on Form 10-K for the year ended December 31, 2019 and its Quarterly Report on Form 10-Q for the quarter ended June 30, 2020. As such, readers are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date made. Except as otherwise required by the federal securities laws, the Company assumes no obligation to publicly release any revisions to such forward-looking statements to reflect events or circumstances after the date as of which they were made.

Contact Information 
Michael Gaiden 
Vice President – Capital Markets and Investor Relations 
Retail Properties of America, Inc.         
(630) 634-4233 

 

 

 

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SOURCE Retail Properties of America, Inc.

FAQ

What is the purpose of Retail Properties of America, Inc.'s recent $400 million notes offering?

The proceeds will be used to repay existing debt and for general business purposes.

When will the offering of senior unsecured notes by RPAI close?

The offering is expected to close on August 25, 2020.

What are the terms of the senior unsecured notes issued by RPAI?

The notes have a principal amount of $400.0 million and a 4.750% interest rate, maturing on September 15, 2030.

Who are the managers for the RPAI notes offering?

The offering is managed by Citigroup, Wells Fargo, Jefferies, KeyBanc, and U.S. Bancorp.

What financial impact does RPAI expect from the debt repayment using the proceeds from the notes?

Repaying debt is expected to improve cash flow and potentially reduce interest expenses.