FelCor's Latest Capital Run Collects $115M

IRVING, TX-Marking its second private placement in two months, FelCor Lodging Trust Inc. is banking $40 million more than it sought from a select group of buyers. The $115 million of new capital will roll into the till this week.

The Irving, TX-based REIT’s select placement is a senior floating rate note with a 2011 maturity. The notes will bear interest at the six-month Libor rate plus 4.25%. Sale proceeds will be used to buy up to $115 million of outstanding 9.5% senior notes due 2008. The exchange will save $4 million annually in interest, Andrew J. Welch, FelCor’s senior vice president and treasurer, tells GlobeSt.com.

Welch says FelCor launched the latest campaign as a $75-million add-on to last month’s $350-million drive, which subsequently was cut to a $175-million private placement when the capital markets failed to respond amid a week of harried financial news about rising interest rates and inflation. With the markets stabilized, FelCor took another run, this time walking away with $40 million more than it planned, he says. The notes are pre-payable in 30 months.