Richter says the transaction was completed as a long-term solution to a need to free up credit for additional real estate purchases and other needs. Richter says the company has no immediate plans to make a purchase.
Richter called the transaction "a great execution." The notes have a 7% coupon and were issued at 99.86 cents on the dollar to yield 7.02% or 1.78% more than similar maturity US Treasuries. According to Weingarten, the REIT hedged exposure to rising interest prior to the bond sale, which resulted in a 6.91% net effective rate.
Banc of America Securities was the book-runner and lead manager for the sale. JP Morgan was the senior co-manager. Banc One Capital Markets Inc., Commerzbank Securities, Daiwa Securities SMBC Europe Limited, First Union Securities Inc., PNC Capital Markets Inc., SouthTrust Securities Inc. and Wells Fargo Brokerage Services LLC also served as co-managers.
The move comes in the midst of a furiously fast year for the REIT. As of May, Weingarten had acquired 24 shopping centers, representing a $383-million investment, with that month's four-center buy in Memphis. Last week, Weingarten closed on Parkway Pointe Shopping Center in Carey, NC. Of the 281 income-producing properties in the Weingarten portfolio, 224 are neighborhood or community shopping centers and 55 are industrial properties. The portfolio also contains one apartment complex and a lone office building.
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