GPT Group Raise $400 million in US Debt

GPT Group, one of the largest owners, managers and developers of Australian retails assets has successfully priced a US$325 million (A$403 million) US Private Placement (USPP) debt issue.

The proceeds will initially be used to repay borrowings under the Group’s revolving bank facilities.

The issuance comprises two tranches -- US$160 million of 12-year notes and US$165 million of 15-year notes.

[Related reading: GPT Group Purchases 25% Stake In The Highpoint Shopping Centre; GPT Steps Into Parramatta With Strategic Acquisition]The pricing represents an average margin of 189 basis points over BBSW once swapped back into Australian dollars.

GPT’s Chief Financial Officer, Anastasia Clarke, said the issuance enhances liquidity, diversifies GPT’s sources of capital and extends the Group’s weighted average debt maturity profile to approximately 6.9 years.

“We are very pleased with the support we have received from US investors, with the initial target offering of US$150 million being increased to US$325 million to meet additional demand,” Clarke said.

“This is a strong endorsement of GPT’s credit strength, with investors attracted to our high quality diversified portfolio.”

GPT's raising follows those of commercial and industrial property group Goodman from the cheaper US and European debt markets with a $US850 million and a €500 million issue.

Vicinity, Investa Office and Charter Hall Retail REIT are among other trusts undertaking buybacks to take advantage of a potential increase in earnings brought about by lower REIT share prices and rising yields.

Main image: Artists impression of GPT's planned 26,000 square metre office tower at 32 Smith Street, Parramatta