NorthStar Income Prices $531.5 Million Floating Rate CMBS Financing Transaction
NEW YORK, Aug. 16, 2013 /PRNewswire/ -- NorthStar Real Estate Income Trust, Inc. ("NorthStar Income") announced today the pricing of a $531.5 million non-recourse, floating-rate CMBS financing transaction, NorthStar 2013-1, at a weighted average coupon of LIBOR + 2.68%. The transaction will initially be collateralized by commercial real estate first mortgages and senior participations originated by NorthStar Income and its sponsor, NorthStar Realty Finance Corp (the "Sponsor"). NorthStar Income will contribute $346.1 million of collateral to the transaction and will have the flexibility to contribute up to $106.3 million of additional collateral within six months of closing. The Sponsor will contribute the remaining $79.1 million of collateral. The transaction is expected to close by the end of August.
A total of $382.7 million of investment grade bonds will be issued, representing an advance rate of approximately 72%. NorthStar Income will retain the non-investment grade bonds and equity interests in the transaction equal to $148.8 million in the aggregate. NorthStar Income expects to earn a yield of approximately 12% on its invested equity, inclusive of fees and estimated transaction expenses. Proceeds from the transaction will be used to repay certain of NorthStar Income's credit facilities, which will generally create new availability under those facilities to finance future loan originations.
The bonds are being offered inside the United States to (1) qualified institutional buyers within the meaning of Rule 144A under the Securities Act of 1933, as amended (the "Securities Act") and (2) to other institutional investors that are accredited investors within the meaning of rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act, and outside the United States to non-U.S. persons in reliance on Regulation S under the Securities Act. The bonds have not been registered under the Securities Act or applicable state or foreign securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and applicable state laws. This announcement shall not constitute an offer to sell or the solicitation of an offer to buy the bonds.
About NorthStar Real Estate Income Trust, Inc. (NorthStar Income)
NorthStar Income is a REIT formed to originate, invest in, and manage a diversified portfolio of commercial real estate debt, securities and select equity investments. The portfolio is diversified across a variety of underlying commercial property types and geographic locations and is secured primarily by U.S.-based collateral.
This press release contains certain "forward‑looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, or Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or Exchange Act. Forward‑looking statements are generally identifiable by use of forward‑looking terminology such as "will," "expects" or other similar words or expressions. These statements are based on NorthStar Income's current expectations and beliefs and are subject to a number of trends and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements; NorthStar Income can give no assurance that its expectations will be attained. Forward-looking statements are necessarily speculative in nature, and it can be expected that some or all of the assumptions underlying any forward-looking statements will not materialize or will vary significantly from actual results. Variations of assumptions and results may be material. Factors that could cause actual results to differ materially from NorthStar Income's expectations include, but are not limited to, the transaction closing on the terms anticipated, if at all, the timing of any such closing, the timing of the underlying loans being repaid, the duration of the transaction, the ability to earn the approximate 12% expected yield on invested equity in the transaction, the ability to contribute up to $106.3 million of additional collateral to the transaction, if any, NorthStar Income using proceeds from the transaction to repay existing credit facilities, the ability to utilize the existing credit facilities to finance new loan originations and the factors described in Item 1A of NorthStar Income's Annual Report on Form 10-K for the fiscal year ended December 31, 2012 under the heading "Risk Factors." The foregoing list of factors is not exhaustive. All forward‑looking statements included in this press release are based upon information available to NorthStar Income on the date hereof and NorthStar Income is under no duty to update any of the forward‑looking statements after the date of this report to conform these statements to actual results.
SOURCE NorthStar Real Estate Income Trust, Inc.
Browse our custom packages or build your own to meet your unique communications needs.
Learn about PR Newswire services
Request more information about PR Newswire products and services or call us at (888) 776-0942.