First Potomac Realty Trust (
, a real estate investment trust (REIT), recently announced the
closing of a secured financing transaction worth $68.4 million. The
5-year loan bears a fixed interest rate of 4.2% over a 30-year
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The financing has been secured by Redland Corporate Center, a Class
A multi-story office property located in the I-270 Corridor in
Rockville, Maryland.. The net proceeds from the transaction will be
utilized to repay a portion of the balance outstanding under First
Potomac's unsecured revolving credit facility.
The strategic move is aimed towards reducing its cost of capital
and capitalizing on future growth opportunities. With this deal,
First Potomac intends to improve its liquidity in the near term and
improve its financial flexibility.
As of June 30, 2012, First Potomac had $928.8 million of debt
outstanding and cash and cash equivalents of $16.1 million.
Earlier in June 2012, the company prepaid the entire $75.0 million
principal balance of its Series A and Series B senior notes.
Headquartered in Bethesda, Maryland, First Potomac focuses on the
ownership, management, development and redevelopment of office and
industrial properties in the greater Washington, D.C. region. The
successful acquisition and investment strategy of the company is
based on its experience of opportunities utilized in the real
estate market. As of June 30, 2012, the company's
consolidated portfolio totalled approximately 14 million square
First Potomac currently retains a Zacks #3 Rank, which translates
into a short-term Hold rating. We also have a long-term Neutral
recommendation on the stock. One of its competitors,
Washington Real Estate Investment
holds a Zacks #4 Rank, which implies a short term Sell rating.