Parkway Properties, Inc.
) - an office real estate investment trust (REIT) - announced the
closure of an unsecured term loan placement worth $120 million,
maturing on Jun 11, 2018. The company obtained the loan from
Wells Fargo & Co.
Notably, Parkway has to bear an interest rate based on LIBOR
plus an applicable margin (initial rate is 1.45%). Also, the term
loan has an option through which its size can be enhanced to as
much as $250 million.
In addition, Parkway completed a floating-to-fixed interest
rate swap totaling $120 million. This helped the company in
locking the LIBOR at 1.61% for 5 years, which resulted in an
initial all-in interest rate of 3.06%.
We expect the strategic move to improve the company's
liquidity position and position it favorably to pursue investment
opportunities. Moreover, the interest rate swapping provides an
advantage to the company in terms of limiting financing
As of Mar 31, 2013, Parkway had $74.6 million of cash and cash
equivalents. It also had $125.0 million outstanding under
its unsecured term loan but no outstanding amount under its
revolving credit facility.
Parkway owns, acquires and manages premium office properties
in vibrant submarkets in the Sunbelt region of the U.S. As of Apr
1, 2013, the company had interest in 45 office properties
(spanning approximately 13.0 million square feet) located across
Parkway currently carries a Zacks Rank #3 (Hold). However,
other well performing REITs include
DCT Industrial Trust Inc.
), both of which carry a Zacks Rank #2 (Buy).
COMMONWEALTH RE (CWH): Free Stock Analysis
DCT INDUSTRIAL (DCT): Free Stock Analysis
PARKWAY PPTY (PKY): Free Stock Analysis
WELLS FARGO-NEW (WFC): Free Stock Analysis
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