Furthers Previously Announced Plan to Increase
Liquidity and Financial Flexibility
SAN DIEGO, Nov. 19 /PRNewswire/ -- Burnham Pacific Properties, Inc.
(NYSE: BPP) today announced that it has obtained a $202.8 million credit
facility with General Electric Capital Corporation. In addition to replacing
the Company's previous line of credit with Nomura Asset Capital Corporation,
the new facility provides the Company with additional borrowing capacity of up
to $20 million for general working capital needs.
Borrowings under the new facility are secured or to be secured by
mortgages on certain of the Company's properties and other assets. The Credit
Facility bears interest at rates of LIBOR (London Inter-Bank Offered Rate)
plus 2.50% and has a one year term.
Commenting on the new credit facility, Dan Platt, the Company's Chief
Financial Officer, stated: "We are pleased to have completed this refinancing
with GE Capital Corporation, who were very responsive to the Company's needs.
This refinancing provides us with additional liquidity to meet our working
capital needs. As we have previously indicated, we are actively marketing
certain properties and would plan to use a portion of the proceeds of those
sales to reduce indebtedness under this facility."
Separately, the Company announced that it is working with CalPERS on
certain modifications to the terms of the Company's joint venture with
CalPERS. Under the proposed agreement, the Company would exchange
substantially all of its equity interest in the joint venture, BPP Retail LLC,
for cash and one property. Funds generated from the transaction would be used
to repay outstanding indebtedness. The Company would continue to serve as the
manager of BPP Retail's assets and would be entitled to continue to receive
fees for asset and property management, as well as leasing, acquisition and
disposition activities, but would no longer be eligible for the incentive fee
attributable to increases in asset values. It is also contemplated that the
Company would transfer two properties to BPP Retail and grant to it options,
exercisable on or prior to December 31, 1999, to acquire two other properties
that the Company had previously agreed to contribute to the joint venture.
Funds generated from these transactions would also be used to pay outstanding
indebtedness.
Guy F. Jaquier, CalPERS' Senior Investment Officer for Real Estate,
stated, "The potential changes to the BPP Retail partnership do not change our
strategic direction to acquire well located grocery-anchored shopping centers.
We have strong confidence in Burnham Pacific's management team and its
abilities to capitalize on prime retail investment opportunities on behalf of
CalPERS and manage the portfolio assets."
J. David Martin, Burnham's Chief Executive Officer, added, "We remain
committed to our relationship with CalPERS. These planned changes are
consistent with our recently announced focus on seeking additional liquidity
and financial flexibility, as we continue to actively pursue all strategic
alternatives. The new arrangement gives us the opportunity to continue to
leverage our management skills and generate significant fee income."
The contemplated modifications to the BPP Retail joint venture
arrangements remain subject to the negotiation and execution of definitive
agreements with CalPERS, as well as certain other conditions, and there can be
no assurance that the planned modifications will be made on these terms, or at
all.
This news release contains "forward-looking statements" that predict or
indicate future events or trends or that do not relate to historical matters.
We cannot assure the future results or outcome of the matters described in
these statements; rather, these statements merely reflect our current
expectations of the approximate outcome of the matter discussed. In
particular, statements regarding the repayment of indebtedness and the
proposed modifications to the Company's joint venture arrangement with CalPERS
constitute forward-looking statements.
Investors should not rely on forward-looking statements since they involve
known and unknown risks, uncertainties and other factors, some of which are
beyond our control. Investors should read the documents the Company files
from time to time with the SEC, specifically the risk factors that were
disclosed in our Registration Statement on Form S-3 that was filed with the
SEC on August 13, 1999. You should be aware that the risk factors contained
in that Form S-3 may not be exhaustive. Therefore, we recommend that you read
the information in that Form S-3 together with other reports and documents
that we file with the SEC from time to time, including our Forms 10-K, 10-Q,
and 8-K which may supplement, modify, supersede or update those risk factors.
SOURCE Burnham Pacific Properties, Inc.
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Related links:
http://www.burnhampacific.com
CONTACT:
investors, Daniel B. Platt, Chief Financial
Officer of Burnham Pacific Properties, Inc., 619-652-4700, or
fax, 619-652-4711, dbplatt@bpac.com; or media, Judy Brennan or
Andrew Cole of Sard Verbinnen & Co., 212-687-8080
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