PHILADELPHIA, Jan. 18, 2017 /PRNewswire/ -- Pennsylvania Real Estate Investment Trust (the "Company") (NYSE: PEI) today announced that it has priced the underwritten public offering of 6,000,000 of its 7.20% Series C Cumulative Redeemable Perpetual Preferred Shares (the "Series C Preferred Shares") at $25.00 per share, plus accrued dividends, if any. The offering is expected to close on January 27, 2017, subject to customary closing conditions. Dividends on the Series C Preferred Shares will be paid quarterly in arrears on the 15th day of each March, June, September and December commencing March 15, 2017 at a rate of 7.20% annually of the stated liquidation value of $25.00 per share, which is equivalent to $1.80 per share on an annualized basis.
The estimated net proceeds from the offering are expected to be approximately $144.8 million, after deducting the underwriting discount and our estimated expenses. The Company intends to use the net proceeds from this offering to repay all or a portion of amounts outstanding under the Company's 2013 Revolving Credit Facility, for general corporate purposes and possibly to redeem some or all of the Company's outstanding Series A Preferred Shares when eligible for redemption in April 2017.
The Company has granted the underwriters for the public offering a 30-day option to purchase up to 900,000 additional Series C Preferred Shares. The Company intends to file an application to list the Series C Preferred Shares on the New York Stock Exchange. If the application is approved, trading of the Series C Preferred Shares on the New York Stock Exchange is expected to begin within 30 days after the initial issuance of the Series C Preferred Shares. Wells Fargo Securities, LLC, Citigroup Global Markets Inc., Jefferies LLC, J.P. Morgan Securities LLC and Stifel, Nicolaus & Company, Incorporated are acting as joint book-running managers for the offering, and Boenning & Scattergood, Inc., BB&T Capital Markets, a division of BB&T Securities, LLC, Canaccord Genuity Inc., Capital One Securities, Inc., MUFG Securities Americas Inc., TD Securities (USA) LLC and U.S. Bancorp Investments, Inc. are acting as co-managers for the offering.
The offering is being made pursuant to an effective shelf registration statement previously filed with the Securities and Exchange Commission on December 22, 2014. The offering may be made only by means of a prospectus supplement and related prospectus, which will be filed with the SEC, which are available on the SEC's website www.sec.gov. Copies of the prospectus supplement and related prospectus for this offering may be obtained by contacting Wells Fargo Securities, LLC at 1-800-645-3751 or firstname.lastname@example.org.
This press release shall not constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
PREIT (NYSE: PEI) is a publicly traded real estate investment trust that owns and manages quality properties in compelling markets. PREIT's 23 million square feet of carefully curated retail and lifestyle offerings mixed with destination dining and entertainment experiences are located primarily in the eastern U.S. with concentrations in the mid-Atlantic's top MSAs. Since 2012, the Company has driven a transformation guided by an emphasis on portfolio quality and balance sheet strength driven by disciplined capital expenditures. Additional information is available at www.preit.com or on Twitter or LinkedIn.
This press release contains certain "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements relate to expectations, beliefs, projections, future plans, strategies, anticipated events, trends and other matters that are not historical facts. We caution that any forward-looking statements presented are based on management's beliefs and assumptions made by, and information currently available to, management. These forward-looking statements reflect our current views about future events, achievements or results and are subject to risks, uncertainties and changes in circumstances that might cause future events, achievements or results to differ materially from those expressed or implied by the forward-looking statements. In particular, our business might be materially and adversely affected by uncertainties affecting real estate businesses generally as well as the following, among other factors: changes in the retail industry, including consolidation and store closings, particularly among anchor tenants; our ability to maintain and increase property occupancy, sales and rental rates, in light of the relatively high number of leases that have expired or are expiring in the next two years; increases in operating costs that cannot be passed on to tenants; current economic conditions and the state of employment growth and consumer confidence and spending, and the corresponding effects on tenant business performance, prospects, solvency and leasing decisions and on our cash flows, and the value and potential impairment of our properties; our ability to sell properties that we seek to dispose of or our ability to obtain estimated sale prices; potential losses on impairment of certain long-lived assets, such as real estate, or of intangible assets, such as goodwill, including such losses that we might be required to record in connection with any dispositions of assets; risks relating to development and redevelopment activities; our ability to identify and execute on suitable acquisition opportunities and to integrate acquired properties into our portfolio; our partnerships and joint ventures with third parties to acquire or develop properties; concentration of our properties in the Mid-Atlantic region; changes in local market conditions, such as the supply of or demand for retail space, or other competitive factors; changes to our corporate management team and any resulting modifications to our business strategies; the effects of online shopping and other uses of technology on our retail tenant; acts of violence at malls, including our properties, or at other similar spaces, and the potential effect on traffic and sales; our substantial debt and stated value of preferred shares and our high leverage ratio; constraining leverage, unencumbered debt yield, interest and tangible net worth covenants under our Credit Agreements; our ability to refinance our existing indebtedness when it matures, on favorable terms or at all; our ability to raise capital, including through the issuance of equity or equity-related securities if market conditions are favorable, through joint ventures or other partnerships, through sales of properties or interests in properties, or through other actions; our short and long-term liquidity position; potential dilution from any capital raising transactions or other equity issuances; and general economic, financial and political conditions, including credit and capital market conditions, changes in interest rates or unemployment. The risks included here are non-exhaustive, and there are additional factors that might cause future events, achievements or results to differ materially from those expressed or implied by our forward-looking statements, including those discussed in the section entitled "Risk Factors" in the prospectus supplement, the accompanying prospectus and the documents incorporated by reference therein, including our Annual Report on Form 10-K for the year ended December 31, 2015 and our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2016, June 30, 2016 and September 30, 2016. We do not intend to update or revise any forward-looking statements to reflect new information, future events or otherwise.
CONTACT: AT THE COMPANY
EVP & CFO
SVP, Corporate Communications and Investor Relations
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