- Easterly Government Properties (NYSE:DEA) agrees to buy a 1,479,762-square-foot portfolio of 14 properties, 94% leased to the U.S. federal government and 99% leased overall for about $430M from an undisclosed third party.
- DEA shares fell about 2.8% in after-hours trading on trading of about 806 shares.
- Based on DEA's underwriting, it believes the aggregate purchase price represents a weighted average underwritten capitalization rate of about 6.5%.
- DEA expects to close the acquisition on a rolling basis in H2 of this year.
- “We are expecting to scale the Company through an approximately 4% accretive deal to our run-rate FFO per share on a fully diluted basis," says Meghan Baivier, DEA's CFO and COO.
- To help fund the acquisitions, DEA is starting a public offering of 15.5M--with 8.5M directly offered by the company and 7.0M offered on a forward basis in connection with forward sales agreements.
- Easterly plans to enter forward sales agreements with Citigroup (NYSE:C) and Jefferies.
- Separately, the company expands its senior unsecured credit facility to $600M with an accordion feature that allows it to increase up to $250M more. The revolving credit facility will initially mature in June 2022, with options that allow extending it to June 2023; the term loan portion matures in June 2023.
- The revolver will bear interest at rate of LIBOR + 1.25%-%1.80% and the term loan at 1.20%-1.75%. Initial spread is set at 1.30% for the revolver and 1.25% for the term loan.
- Previously: Easterly Government misses by $0.01, misses on revenue (May 8)
- Now read: Panning For Gold: 'Nobody Does It Better'
Original article