Lexington obtained the secured credit facility, which includes a $165-million term loan and an $85-million revolving credit agreement, through KeyBank National Association, according to a release. The unsecured revolving credit facility had an outstanding balance of $25 million as of Dec. 31, 2008, while the term loan had $174.3 million outstanding as of that date.
The new facility bears interest at 2.85% over LIBOR and will mature in February 2011, but can be extended until February 2012 at Lexington's option, the release states. It's secured by a borrowing base of 72 properties.
Additionally, Lexington has the option of increasing the size of the term loan by $135 million and the revolving loan by $115 million, pending approval by its lenders. This would double the credit facility to $500 million, and would be secured by adding properties to the borrowing base.
According to fourth-quarter 2008 results released last month, Lexington sold its interest in 17 properties to unrelated parties for an aggregate sales price of $49.5 million. These properties generated annualized net operating income of $2.1 million or 4.3% of the sales price, according to the release.
Also during Q4 '08, the REIT obtained a $13.7 million non-recourse mortgage loan secured by a Boston property leased to Harvard Vanguard Medical Association. In addition, Lexington in the fourth quarter reduced the outstanding balance of its secured term loan due in June from $197.9 million to $174.3 million.
As reported in December by GlobeSt.com, Lexington completed an internal merger with the Lexington Master Limited Partnership. T. Wilson Eglin, CEO of Lexington, told GlobeSt.com in December that the merger would save about $1 million annually "and simplify our corporate structure." Lexington is now 100% owner of all of the assets formerly owned by the MLP.
At the end of Q4, the REIT's portfolio was approximately 94% leased, and the company executed 24 new and renewal leases, totaling approximately 1.5 million square feet, during the quarter. Lexington specializes in single-tenant net-leased properties.
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Paul Bubny
Paul Bubny is managing editor of Real Estate Forum and GlobeSt.com. He has been reporting on business since 1988 and on commercial real estate since 2007. He is based at ALM Real Estate Media Group's offices in New York City.
