The revolver has an initial interest rate of SOFR plus 1.40%(1) and the term loan has an initial interest rate of SOFR plus 1.35%. In addition, the Company entered into interest rate swaps to fix the interest rates on the $375 million term loan, locking in a rate between 3.36% and 3.42% (plus 1.35%) until maturity.
The renewal of the credit facility accomplishes several key objectives:
Locks down a key earnings variable, strengthening Whitestone's ability to hit their 5, 7% Core FFO per share growth target in 2026, 2027 and 2028
Extends Whitestone's weighted average maturity date out to 2030 with no maturities due in 2026
Reduces Whitestone's current variable debt to approximately 12%
Provides additional borrowing capacity
Expands the company's bank group
"We are very pleased with the new facility, which includes a $215 million increase in size, lower interest rates, extended maturities and the addition of 3 strong new banks. Among the positive changes from the previous agreement was a lowering of the interest rate and an improvement in the capitalization rate used for valuation from 7% to 6.75%. These, and other improvements reflect the continued strengthening of our operations and financial position, and will provide additional liquidity and financial flexibility," said Dave Holeman, Whitestone's CEO. "Since our last extension in 2022, we have improved our leverage metrics by driving EBITDAre up, delivering top quartile Same Store Net Operating Income Growth and focusing on disciplined, effective capital spending. This agreement builds on the progress we've made over the last 3 years and lays the groundwork for additional consistent growth."
The co-lead arrangers and joint-book runners for the facility were BMO Capital Markets Corp., BofA Securities, Inc., Capital One, National Association, Citizens Bank, N.A, KeyBanc Capital Markets Inc., Truist Securities, Inc., and U.S. Bank National Association.
(1) Based on the Company's current leverage ratio as defined in the facility. Please see today's 8-K for more detail.
About Whitestone REIT
Whitestone REIT (NYSE:WSR) is a community-centered real estate investment trust (REIT) that acquires, owns, operates, and develops open-air, retail centers located in some of the fastest growing markets in the country: Phoenix, Austin, Dallas-Fort Worth, Houston and San Antonio.
Our centers are convenience focused: merchandised with a mix of service-oriented tenants providing food (restaurants and grocers), self-care (health and fitness), services (financial and logistics), education and entertainment to the surrounding communities. The Company believes its strong community connections and deep tenant relationships are key to the success of its current centers and its acquisition strategy. For additional information, please visit the Company's investor relations website.
Forward-Looking Statements
This Report contains forward-looking statements within the meaning of the federal securities laws, including discussion and analysis of our financial condition, pending acquisitions and the impact of such acquisitions on our financial condition and results of operations, anticipated capital expenditures required to complete projects, amounts of anticipated cash distributions to our shareholders in the future and other matters. These forward-looking statements are not historical facts but are the intent, belief or current expectations of our management based on its knowledge and understanding of our business and industry. Forward-looking statements are typically identified by the use of terms such as "may," "will," "should," "potential," "predicts," "anticipates," "expects," "intends," "plans," "believes," "seeks," "estimates" or the negative of such terms and variations of these words and similar expressions, although not ...
