Retail real estate investment trust (REIT),
Regency Centers Corporation
) recently disclosed the amendment of its unsecured term loan
facility. The move would give the company greater financial
flexibility and enhance its liquidity.
Specifically, with this amendment, Regency can enjoy a new facility
size of $165 million, maturity date extension to Jun 27, 2019 and
most importantly a reduction in the applicable interest rate.
Syndicated to a consortium of 10 banks including
Wells Fargo Bank
Regions Financial Corporation
), this facility bears interest at LIBOR plus 1.15% per annum and
has to undergo an unused fee of 0.20% per annum on the balance
undrawn. Notably, as of Jun 30, 2014, borrowings under the facility
totaled $75 million. The company can choose to borrow up to an
additional $90 million until Aug 31, 2015.
The enhanced liquidity will likely be spent on general corporate
needs as well as development and redevelopment measures. It also
plans to exercise this flexibility on its maturing debt payback
Hence, we believe that this facility amendment is a strategic fit
as the company can now enjoy not only time extension and enhanced
size but also meet its growth needs and debt obligations
efficiently. Also, this reflects the confidence of the banks in
this company's fundamentals. Notably, the company exited
first-quarter 2014 with cash and cash equivalents of nearly $44.4
million, down from $90.2 million at the prior-quarter end.
As a matter of fact, Regency is diligently working toward uplifting
its properties' quality to attract more in shoppers. In recent
times, the company added
ULTA Salon, Cosmetics & Fragrance, Inc.
) and 18|8 as tenants at 4S Commons Town Center in San Diego, CA,
to offer a better salon experience.
Also, Regency announced the redevelopment of a community center -
Kings Park Shopping Center - based in Burke, VA to expand the
center and enhance the shopping experience (read: Regency
Refurbishes VA Asset to Boost Footfall). Such targeted measures are
expected to attract greater footfall and drive demand at the
Regency currently carries a Zacks Rank #3 (Hold).
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REGIONS FINL CP (RF): Free Stock Analysis
WELLS FARGO-NEW (WFC): Free Stock Analysis
REGENCY CTRS CP (REG): Free Stock Analysis
ULTA SALON COSM (ULTA): Free Stock Analysis
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