Easterly Government Properties announces expansion of its first senior unsecured sustainability credit facility
WASHINGTON–(COMMERCIAL THREAD) – Easterly Government Properties, Inc. (NYSE: DEA) (the “Company” or “Easterly”), a fully integrated real estate investment trust focused primarily on the acquisition, development and management of Class A commercial properties leased to the United States government, today announced that it has replaced its existing senior unsecured revolving credit facility with an Amended and Enhanced Credit Facility (the “Amended Credit Facility”), consisting of (i) a $ 450 million revolving unsecured senior credit facility (the “Revolver”) and (ii) a $ 200 million senior unsecured term loan facility (the “Term Loan” ), of which up to $ 50 million will be available on a deferred drawdown basis up to 364 days after the closing date, for a total credit facility size of $ 650 million. The Revolver includes an accordion feature that allows the Company to request additional loan commitments of up to $ 250 million, for a total modified credit facility capacity of up to $ 900 million. The Revolver will initially mature four years from the closing date, July 2025, with two six-month entitlement options available to extend the maturity until July 2026. The term loan will expire five years from the closing date, in July 2026. The term loan is prepayable without penalty for the life of the loan.
Borrowings under the Revolver will bear interest at the LIBOR rate plus a spread of 1.20% to 1.80%, depending on the Company’s leverage ratio. The term loan will bear interest at the LIBOR rate plus a spread of 1.20% to 1.70%, depending on the Company’s leverage ratio. Given the Company’s current leverage ratio, the initial spread over LIBOR is set at 1.25% for the Revolver and 1.20% for the Term Loan. The amended credit facility also has a sustainability pricing component whereby the spread will decrease by 0.01% if Easterly meets certain sustainability targets as determined by an independent third-party assessment.
“The implementation of an extended credit facility that incorporates sustainability performance indicators is indicative of Easterly’s commitment to making significant progress in our ESG journey,” said Meghan G. Baivier, Chief Financial Officer and Operations Officer of Easterly. “We believe that earning an even more attractive cost of capital to reap the benefits of sustainability is an obvious next step for our larger and more diverse balance sheet.”
The Company intends to use borrowings under the Amended Credit Facility for general corporate purposes including, but not limited to, acquisitions, development, redevelopment and other expenses. in fixed assets.
In addition, the Company has amended its senior unsecured term loan of $ 100 million to comply with certain provisions of those included in the amended credit facility.
Citibank, NA, PNC Capital Markets LLC and Wells Fargo Securities, LLC acted as principal arrangers and associate bookrunners on the Amended Credit Facility. Citibank, NA served as administrative agent and PNC Bank, National Association and Wells Fargo Bank, NA served as co-syndication agents.
About Easterly Government Properties, Inc.
Easterly Government Properties, Inc. (NYSE: DEA) is based in Washington, DC, and focuses primarily on the acquisition, development and management of Class A commercial properties that are leased to the US government. Easterly’s experienced management team brings expert insight into the strategy and needs of critical US government agencies for properties leased to those agencies, either directly or through the US General Services Administration (GSA). For more information about the company and its properties, please visit www.easterlyreit.com.
This press release contains forward-looking statements within the meaning of federal securities laws and regulations. These forward-looking statements are identified by the use of terms and expressions such as “believe”, “expect”, “intend”, “plan”, “anticipate”, “position” and other terms. and similar expressions, including references to assumptions and forecasts of future results. Forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those anticipated at the time the forward-looking statements are made. These risks include, without limitation, the risks and uncertainties associated with our business described from time to time in our filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K filed on February 24, 2021. Although we believe that the expectations reflected in these forward-looking statements are based on reasonable assumptions, we cannot guarantee that the expectations will be met or that any deviation will not be material. All information in this press release is as of the date of this press release, and we assume no obligation to update any forward-looking statements to conform the statement to actual results or to changes in our expectations.