Global Net Lease, Inc. (NYSE: GNL) announced today that it closed on a multi-property refinancing encumbering seven properties in France and signed a term sheet for a potential new mortgage loan that would ultimately be syndicated by a group of regional banks led by BOK Financial for a mortgage encumbering six properties leased to Whirlpool Corporation in the United States.
The Company, through certain of its subsidiaries, entered into a loan agreement with HSBC France ("HSBC") and borrowed €70 million secured by the seven properties the Company owns in France. The maturity date of this loan is May 14, 2025. The loan will float at a rate equal to 3-month EURIBOR (with a floor of 0.0%) plus an initial margin of 2.3% resulting in an all-in effective interest rate of 2.3%. The Company expects to fix the rate via a swap agreement with HSBC in the next 30 days. The loan is interest-only with the principal due at maturity. At the closing of the loan, €25 million was used to repay all outstanding indebtedness on four of the properties. Of the remaining proceeds, totaling approximately €42.5 million after costs and fees, approximately €20 million was used to repay amounts outstanding under the Company's revolving credit facility and the balance is available for general corporate purposes.
Additionally, as noted above, the Company, through certain of its subsidiaries, has entered into a term sheet for a potential new mortgage loan for up to $88 million that would be syndicated by a group of regional banks led by BOK Financial. The loan would be secured by six properties that are leased to Whirlpool. The seven-year, interest only floating rate loan would bear interest at a rate equal to one-month LIBOR plus 2.9%. The Company anticipates fixing the floating rate at closing via an interest rate swap. The completion of the potential new loan is subject to, among other things, market conditions and the negotiation and execution of definitive documentation, and there can be no assurance the potential new loan will be completed on the terms contemplated by the term sheet, or at all.
"We are proud to announce the French Multi-Property Financing and the Whirlpool loan and are very pleased with the attractive rates we were able to negotiate," said James Nelson, CEO of GNL. "Despite the ongoing global effects of the COVID-19 pandemic, our team continues to deliver meaningful achievements for GNL, including these loans and the tremendous collection of 98% of cash rents in April. Our portfolio, which was 99.6% leased at the end of the first quarter, is comprised of high-quality tenants with long-term leases and is primarily allocated to mission critical industrial, distribution and office assets such as the properties that secure the Whirlpool loan."
He continued, "Both of these loans illustrate our commitment to working with our banking partners to extend the weighted average maturity of all of our debt, which was 5.3 years after the loan closed, up from 3.3 years at the end of the second quarter, 2018 when we began refinancing of all our European debt. Combined with the refinancings we previously announced for the properties we own in Finland, Germany, the Netherlands, Luxembourg, and the U.K we have completely reshaped our European financing over the last 20 months. We are pleased with the overall effect on our balance sheet, where we have ample liquidity and are paying a weighted average interest rate of 3.1% on our debt."
About Global Net Lease, Inc.
Global Net Lease, Inc. (NYSE: GNL) is a publicly traded real estate investment trust listed on the NYSE focused on acquiring a diversified global portfolio of commercial properties, with an emphasis on sale-leaseback transactions involving single tenant, mission critical income producing net-leased assets across the United States, Western and Northern Europe. Additional information about GNL can be found on its website at www.globalnetlease.com.
